Highlights

• Domestic Demand Remains Resilient but Increasingly Precautionary: Consumer confidence rose to 127.0 — the highest since January 2025 — supported by labor absorption and seasonal Eid stimulus. However, BI survey data shows rising savings and debt repayments, indicating cautious household balance-sheet behavior despite improved sentiment.

 

• External Buffers Stable, but Geopolitical Risk Channel Re-emerges: FX remains stable near 16,800/USD while US 10Y yields hover around 4.15–23%. EU scrutiny over Russian oil logistics involving Indonesian ports introduces a new compliance and reputational risk layer to the energy sector.

 

• Fiscal Expansion Continues Amid Growing Credibility Scrutiny: IDR 17 trillion Eid-related social assistance and APBN-backed Whoosh debt servicing reinforce state-led growth support. However, CPI downgrade to 109th globally and BPJS targeting inefficiencies raise governance-sensitive risk premiums.

 

• Equity Rebound Driven by Domestic Flows, Foreign Participation Still Fragile: JCI rebounded sharply early week (8,030–8,291 range) led by energy and cyclicals, but persistent foreign net selling suggests underlying risk appetite remains cautious.

 

• Bond Market Stabilizing but Range-Bound Under Global Yield Pressure: Long tenors retain relative strength, yet duration appetite remains constrained by FX sensitivity and global rate volatility. Market remains in post-selloff consolidation phase.