Indonesia market rescue efforts backfire as investor confidence continues to erode
Recent policy shifts and ambitious spending plans in Indonesia have failed to reassure investors. Markets remain volatile as the rupiah nears record lows.
Insights:
President Prabowo Subianto has appointed his nephew as a deputy governor of the central bank of Indonesia 
ID, a move that coincided with rapid policy responses from the Indonesian government and other authorities following a sovereign outlook downgrade by Moody's Corporation and criticism from MSCI Inc. . These events have occurred alongside significant market stress, characterized by a weakening rupiah and underperformance in the Indonesian stock market. As of February 24, 2026, the country's main equity index has fallen by more than 3% this year, marking the worst performance in the region.
ID, a move that coincided with rapid policy responses from the Indonesian government and other authorities following a sovereign outlook downgrade by Moody's Corporation and criticism from MSCI Inc. . These events have occurred alongside significant market stress, characterized by a weakening rupiah and underperformance in the Indonesian stock market. As of February 24, 2026, the country's main equity index has fallen by more than 3% this year, marking the worst performance in the region.
