(Bloomberg) -- Bank Indonesia warned there is less scope for it to further lower interest rates as political developments in the US add to global risks, spurring fund flows into the dollar and pressuring the rupiah.

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“The room for rate cuts that we previously saw as wide does seem narrower now,” Bank Indonesia Governor Perry Warjiyo said in a briefing on Wednesday, after he announced that the benchmark BI-Rate would be kept unchanged at 6%.

Indonesia’s central bank stood pat for the second month in a row after a surprise reduction in September. The move was forecast by 27 of the 36 economists surveyed by Bloomberg, while the remainder expected a quarter-point cut.

External jitters featured heavily in Warjiyo’s remarks, as the rupiah weakened further toward the key support level of 16,000 per dollar.

Warjiyo said Bank Indonesia is scrutinizing President-elect Donald Trump’s plans for higher tariffs and spending. They now expect the Federal Reserve to deliver fewer rate cuts, slashing their forecast to only 75 basis points in reductions through 2025, from as much as 125 basis points previously.

All of these factors point to a stronger dollar, Warjiyo said.

“If we consider the low domestic inflation and the need to boost economic growth, of course there is still room for rate cuts” in Indonesia, Warjiyo said. “But with the rapid development of global dynamics, the focus of our monetary policy remains directed at strengthening rupiah stability against global geopolitical and economic uncertainties.”

The rupiah held its loss at 0.2% against the greenback following the rate decision on Wednesday. Indonesia’s benchmark stocks gauge trimmed losses to 0.2%, while 5-year and 10-year yields were unchanged.

Warjiyo’s predicament highlights how emerging-market central banks have had to set aside domestic growth concerns to steady their currencies, after Trump’s victory drove up the dollar. The Philippine central bank said on Wednesday it could also pause its easing if the weakened peso spurs imported inflation.

While Indonesia’s inflation is set to remain manageable and within the central bank’s 1.5%-3.5% target band for 2024 and 2025, domestic activity needs a boost. Southeast Asia’s largest economy grew at its slowest pace in a year last quarter, with high borrowing costs dampening consumption and factory activity.