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S&P Maintains Indonesia Credit Rating, Saying Fiscal Strains Could Be Temporary
S&P said Indonesia’s revenue should recover as commodity prices rise and the government trims spending to keep the deficit near 3%.
- Credit ratings agency S&P affirmed Indonesia's BBB/A-2 sovereign credit ratings on Monday, characterizing recent fiscal strains as temporary and expecting stronger commodity prices and spending cuts to offset economic pressure.
- President Prabowo Subianto has pursued high-spending policies, including the Free Nutritious Meals Program, pushing the budget toward a 3% annual deficit ceiling since taking office in October 2024.
- The Indonesian rupiah has traded near 18,000 against the dollar, down from around 15,500 at Prabowo's inauguration, though Bank Indonesia officials noted significant room for currency strengthening with improving investor confidence.
- Fellow ratings agencies Moody and Fitch cut their outlooks for Indonesia to negative earlier this year, citing increasing policy uncertainty and growing centralization of policymaking authority under Prabowo.
- SGMC Capital fund manager Mohit Mirpuri called the affirmation "a win," noting expectations for policy reforms and fiscal discipline to become more evident in the second half of the year.
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S&P Affirms Indonesia’s Investment-Grade Rating, Keeps Stable Outlook
Indonesia retained its investment-grade rating and stable outlook at S&P Global Ratings, a reprieve for President Prabowo Subianto and his fiscal policy credibility after a bond market selloff in June.
·New York, United States
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Standard & Poor's (S&P) Global Ratings maintained Indonesia's debt rating at BBB with a stable debt rating projection.
·Indonesia
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Bank Indonesia (BI) considers S&P Global Ratings' decision to maintain Indonesia's sovereign debt rating at BBB with a stable outlook a positive signal of investor and international market player confidence in the resilience of the national economy.
·Indonesia
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Total News Sources13
Leaning Left2Leaning Right0Center3Last UpdatedBias Distribution60% Center
Bias Distribution
- 60% of the sources are Center
60% Center
L 40%
C 60%
Factuality
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