(Bloomberg) -- Bank Indonesia sees no immediate need to raise interest rates further while reiterating its preference for using market intervention to stabilize the rupiah.

“We currently see no need to increase the BI rate yet because inflation is low. This is also so that it doesn’t impact economic growth negatively,” said Governor Perry Warjiyo at a parliament hearing on Monday. 

“We will maintain the stability of the rupiah exchange rate with three instruments: interventions, SRBI instruments and — if necessary — an increase in the BI rate,” he added, adding that the monetary authority remained confident the rupiah would return to its fundamental value of stronger than 16,000 a dollar.

Warjiyo’s comment reinforces BI’s stance in keeping rate hikes as a last resort to bolster the rupiah, especially as inflation remains well within its target of 1.5%-3.5% and the economy is expected to grow 4.7%-5.5% this year. That’s far short of President-elect Prabowo Subianto’s goal of boosting economic expansion to 8% during his term.

The rupiah has been trading near a four-year low due to high corporate dollar demand and investors’ concern over the incoming government’s fiscal policies. The currency gained 0.1% on Monday to 16,430 a dollar as of 1:24 p.m. in Jakarta. 

--With assistance from Claire Jiao.

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