Overview

Indonesia is making significant strides in various sectors, from international trade agreements to infrastructure and digital economy development. Despite facing challenges such as geopolitical tensions and internal corruption issues, Indonesia's strategic initiatives in energy, economic growth, and digital transformation are positioning it as a regional powerhouse. The country's commitment to economic development is evident in its ongoing partnerships and ambitious domestic projects, while also addressing issues like poverty, corruption, and digital safety.

Key Point:

■ Indonesia and the EU have reached a political deal allowing Indonesia to export palm oil to Europe at 0% tariff. This landmark agreement follows years of regulatory hurdles and solidifies Indonesia’s position as a key player in the global palm oil market.

■ Indonesia is set to issue its first-ever Kangaroo Bonds, denominated in Australian dollars, with the issuance scheduled for August 2025. This marks an important step in diversifying the country’s debt issuance strategy.

■ On Thursday (7/31), JCI closed -0.87% lower at 7,484.3 with foreign investors posting net sell of IDR 1508.2 billion in the regular market and net buy of IDR 244.8 billion in the negotiated market.

■ The Relative Rotation Graph (RRG), most long-term tenors above 10 years are still leading, with the exception of the 11-year, but currently with strengthening momentum, except for the 15- and 20-year tenors. Meanwhile, short-term tenors below the 10-year benchmark are all lagging, with strengthening momentum, except for the 1- and 3-year tenors.

■ We recommend INDOGB bonds such as FR84, FR37, FR35, FR35, FR90 and INDOIS: PBS21, PBS20, PBS05.