Indonesia's legislature has passed a bill that expands the role of the country's central bank, Bank Indonesia, in a move aimed at spurring economic growth, Reuters reports.

The bill marks a significant shift in the legal framework governing Bank Indonesia. Under the previous mandate, the central bank focused primarily on maintaining rupiah stability and controlling inflation. The new legislation broadens that mandate, directing the bank to play a more active part in supporting the government's growth agenda.

The amendment arrives at a moment of mounting pressure on emerging-market central banks to do more than hold prices steady. Policymakers across the region have faced calls to balance inflation control with the need to finance infrastructure, stabilise currencies and support credit expansion. Indonesia's legislature has now answered that call in statutory form.

For practitioners, the practical consequences are immediate. Financial institutions operating in Jakarta will need to reassess how a broadened central bank mandate affects monetary policy transmission, liquidity operations and coordination with the finance ministry. Foreign investors watching Bank Indonesia's independence will scrutinise the statutory language for any dilution of the bank's autonomy, a question that has accompanied similar reforms elsewhere. Legal teams advising banking clients should track the implementing regulations that typically follow legislation of this kind.

The passage of the bill follows a period of debate over how far the central bank should go in supporting government economic programmes. Proponents argued that a wider mandate equips Bank Indonesia to respond more effectively to growth challenges. Critics have long warned that stretching a central bank beyond price stability risks blurring the line between monetary and fiscal policy.

Reuters reported the development without immediately detailing the full text of the legislation, the vote count or the timeline for entry into force. Further implementing details are expected as the bill moves toward enactment and the bank adjusts its policy framework to the new mandate.