■ BI Maintains Rate at 5.75%: With currency and inflation risks constraining BI’s policy flexibility in supporting growth through lower interest rates, the central bank maintains its benchmark interest rate at 5.75% at its September 23, c2026, policy meeting, marking the third consecutive hold following cumulative tightening of 100 bps in May–June. The decision was in line with Samuel Sekuritas Indonesia’s (SSI) forecast, with deposit and lending facility rates unchanged at 4.75% and 6.50%, respectively.

 

■ MSCI Concerns Continue to Pressure Equities: The proposed reclassification to standalone market status underscores unresolved ownership transparency and governance concerns, with Goldman Sachs estimating potential outflows of USD5.6bn under an adverse downgrade scenario. Prolonged uncertainty could discourage foreign investment and erode economic fundamentals.

 

■ Investment Figures Mask Uneven Economic Benefits: Investment realization reached IDR3,923.2tn between 4Q24 and 3Q26, generating approximately 5.49mn jobs. However, these cumulative figures offer limited evidence of stronger recent momentum or sustained improvements in wages and household purchasing power. In fact, we observe credit growth deceleration from the banking sector and plenty of anecdotal evidence of retail sales slowing.

 

■ **Nickel Exports Remain Vulnerable:** 2026 full-year nickel export value is expected to remain relatively flat on a Y-Y basis at USD39.7bn, despite tighter production quotas and stronger prices. Looking ahead, restricted output could limit volumes, while weaker prices would pressure export earnings and producer margins.

 

■ **IDR Faces Persistent Pressure:** In 2026 thusfar, Indonesia’s local currency weakened against seven of eight monitored ASEAN currencies, suggesting weakness beyond USD strength alone. Continued depreciation will increase import costs while foreign debt burdens will limit BI’s room to ease, both of which will erode Indonesia’s GDP growth.