Report · Finance & Economics
The State of Indonesian Markets 2026
The economy is holding up, but markets have sold off hard. GDP grew 5.29% in the second quarter, yet the stock index is down about 38% this year and the Rupiah is near its record low. On Oct 15, MSCI proposed moving Indonesia from Emerging to Standalone status, with a decision due by June 30, 2027, and that's the biggest swing factor for next year. Our base case puts 2027 growth at 4.8–5.2% and the Rupiah at 17,800–18,600 per dollar. That's below the 2027 state budget's assumption and the IMF and World Bank forecasts. The scenario ranges and probabilities are my own projections and are labelled that way.
Overview
The economy is holding up, but markets have sold off hard. GDP grew 5.29% in the second quarter, yet the stock index is down about 38% this year and the Rupiah is near its record low. On Oct 15, MSCI proposed moving Indonesia from Emerging to Standalone status, with a decision due by June 30, 2027, and that's the biggest swing factor for next year. Our base case puts 2027 growth at 4.8–5.2% and the Rupiah at 17,800–18,600 per dollar. That's below the 2027 state budget's assumption and the IMF and World Bank forecasts. The scenario ranges and probabilities are my own projections and are labelled that way.
Methodology and AI-use disclosure
This report was made with the use of Kuartal AI trained models