Indonesia cuts for twelfth time since May 2006

As widely expected, Bank Indonesia reduced its policy interest rate - used as a reference for bill sales - by a quarter point to 8.5% today, taking advantage of the lowest inflation rate in six months. It was the twelfth rate cut since May 2006.

Reduced borrowing costs will assist the government in achieving its 6.3% economic growth target.

Commercial lenders confirmed that they would certainly plan to reduce their rates to reflect today's move. Economists say the rate cut would boost lending