Market jitters and state fund Danantara’s gamble: Can Indonesia win back investors?
With the country’s economic policies in constant flux, investors are navigating cautiously and on edge for sudden shifts
[JAKARTA] It has been a frenzied first quarter for Indonesia so far. South-east Asia’s largest economy is facing mounting pressure, with the rupiah hitting its lowest point since the Asian financial crisis, compounded by last week’s shocking equity market meltdown.
As markets digest the turn of events – led partly by the exit of foreign institutional investors amid uncertainties over Indonesia’s economic prospects and signs of some political fissures – is there any silver lining?
The stock market’s key barometer, the Jakarta Composite Index, has lost 8.4 per cent since the start of the year, with US$1.83 billion in foreign capital having fled the market.
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