Indonesia’s economic resilience is being tested by a disconnect between strong macroeconomic fundamentals and negative market sentiment, according to recent analysis. Despite a revised negative outlook from Moody’s Corporation on , high-frequency data suggests continued economic strength.
Economic Indicators Point to Underlying Strength
Bank Indonesia’s decision to hold the BI-Rate at 4.75% on , reinforces stability, with 2026 growth projected to accelerate to as high as 5.7%. The Mandiri Spending Index reached a peak of 372.8 on , indicating robust consumer spending. PT Bank Central Asia Tbk (BCA) reported a 9.8% year-over-year growth in consumer spending as of the end of 2025. Fourth quarter 2025 GDP growth surprised to the upside, reaching 5.39% – the highest rate since 2022.
However, the market is currently reacting to a perceived increase in risk, triggered by MSCI Inc.’s warning of a potential reclassification to Frontier Market status by May 2026. This has led to institutional outflows, despite the underlying stability of the banking system. Broad money supply (M2) grew by 9.6% year-over-year in December 2025, driven by active bank lending.
Market Performance and Key Data Points
On , the Indonesia Stock Exchange (IDX) composite index closed down 0.64% at 8,212.3. Foreign net selling reached Rp2.0 trillion. The Rupiah strengthened slightly, gaining 0.12% to 16,839 against the US dollar. Gold prices rose by 0.83% to 4,989.
Corporate News and Developments
XLSmart Telecom Sejahtera ($EXCL) reported a net loss of Rp4.4 trillion for 2025, compared to a net profit of Rp1.8 trillion in 2024. The fourth quarter loss amounted to Rp1.8 trillion, up from Rp1.3 trillion in the third quarter. Despite the losses, revenue increased to Rp42.4 trillion, a 23% year-over-year increase, driven by a rise in Average Revenue Per User (ARPU) to Rp44,800.
Astra International ($ASII) reported wholesale car sales of 34,867 units in January 2026, a 1% increase year-over-year but a 15% decrease month-over-month. Daihatsu sales increased by 25% year-over-year, while Toyota+Lexus sales declined by 9% year-over-year.
Elang Mahkota Teknologi ($EMTK), the controlling shareholder of Surya Citra Media ($SCMA), purchased approximately 2.7 billion shares of SCMA between and , increasing its ownership stake to 74.02%. Similarly, PT Kreatif Media Karya, a subsidiary of EMTK, acquired approximately 6.7 billion shares of Bukalapak ($BUKA), raising its ownership to 40.55%.
MNC Digital Entertainment ($MSIN) is reportedly considering a listing on the Hong Kong stock exchange, according to Bloomberg. Kawasan Industri Jababeka ($KIJA) has officially launched a mini liquefied natural gas (LNG) plant in Pasuruan Industrial Estate Rembang, East Java, with a total investment of US$16.9 million. Pertamina Geothermal Energy ($PGEO) is targeting electricity production of 5,255 GWh in 2026, a 3.14% increase year-over-year.
Stockbit Highlights and Investor Sentiment
Indonesia Economic Outlook 2026, presented on , highlighted a target economic growth range of 5.5–6% for the first quarter of 2026, driven by increased government spending, domestic investment, and consumer spending. The government aims for full-year growth of 5.4–6%. The Free Nutritious Meal (MBG) program has reached 60.2 million beneficiaries as of , with a target of 82.9 million by May-June 2026. Plans are underway to establish approximately 30,000 Village Red and White Cooperatives in 2026, and 1,000 Fishermen Villages by 2026.
Investment is targeted to grow at a compound annual growth rate of 15.7% between 2025 and 2029, driven by downstreaming initiatives. Major investment projects planned for 2026 include the ‘Wamena’ waste-to-energy project (Rp84 trillion) and the ‘Johor’ agriculture project (Rp84 trillion) in collaboration with Australia.
The government is focusing on increasing oil and gas lifting through technology, private sector involvement, and potential revocation of concessions. Efforts are also underway to reduce imports through the development of dimethyl ether (DME) from coal and ethanol blending for gasoline. A potential ban on raw material exports, including tin, is also being considered.
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