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(Bloomberg) -- Policymakers in Southeast Asia’s two largest economies will probably keep interest rates unchanged on Wednesday as they weigh uncertainties over political transitions while awaiting the Federal Reserve’s imminent easing.

Thirty-four of 36 economists surveyed by Bloomberg expect Bank Indonesia to keep its benchmark BI-rate at 6.25% for a fourth straight meeting, with two anticipating a quarter-point cut. All but one of the 24 analysts polled on Bank of Thailand’s one-day repurchase rate forecast a hold at 2.5%. One predict a cut to 2.25%.

Despite a brightening outlook for Indonesia, thanks to a stronger rupiah and waning investor concerns over President-elect Prabowo Subianto’s fiscal policy, the BI will likely opt to wait a little longer before easing. In Thailand, rate-setters may want more clarity about the plans of its new leader Paetongtarn Shinawatra before cutting borrowing costs.

“We expect both central banks to stay on-hold but BI could pivot dovish in its commentary and pave the way for a cut” in September, said Euben Paracuelles, a Nomura Holdings Inc. economist in Singapore.

A number of economists, including from Standard Chartered Plc, Capital Economics Ltd. and Oversea-Chinese Banking Corp., anticipate a dovish tone from Thai policymakers on Wednesday, paving the way for looser settings in the fourth quarter.

Here’s what to watch out for at around 2 p.m. in Bangkok and Jakarta:

Indonesia

Bank Indonesia may hold the BI rate to prevent a hasty easing from hurting currency stability. While Governor Perry Warjiyo has repeatedly signaled that a rate-cut is on the horizon, he flagged caution earlier this month about external risks, including elevated US treasury yields that could reverse foreign capital flows and pressure the local currency.

The rupiah has climbed about 5% against the dollar this month amid a firmer prospect of US policy rate cut.

Indonesia targeting a moderate 2025 fiscal deficit gave further respite to investors. Sovereign bonds saw foreign capital inflows top $1 billion this month as investors locked in returns before borrowing costs fall.

“But more important is the medium-term outlook – which will be driven by key cabinet members and policies of the new government taking over in October,” Pranjul Bhandari, chief India and Indonesia economist at HSBC Holdings Plc, wrote in a note. HSBC expects BI’s easing cycle to begin in the fourth quarter after the Fed delivers its first rate cut.

Inflation softened further last month to the slowest pace in over two years, but that was mainly supply-driven. Trade balance on the other hand surprisingly narrowed sharply in July to the smallest print since May 2023, which will likely encourage greater caution at BI against prematurely cutting rates, Barclays Plc analyst Brian Tan said.

Thailand

The BOT is widely expected to stand pat amid improving economic prospects and the gradual pick-up in inflation, bringing it closer toward the lower bound of its 1%-3% target. Uncertainty around Paetongtarn’s priorities also adds to the case for the central bank to wait and watch.

The monetary authority has kept the key rate steady since the fourth quarter of 2023, despite repeated calls from ousted leader Srettha Thavisin for an early easing.

Read: Thai Central Bank May Face More Rate-Cut Pressure From New PM

“There is little impetus for the BOT to act now. It will also want more clarity on the new government’s policy priorities,” said Krystal Tan, an economist at Australia & New Zealand Banking Group Ltd.

--With assistance from Matthew Burgess and Shinjini Datta.