JAKARTA, INDONESIA / RankWire.AI / – Through early October 2026, Indonesia has attracted Rp131.1 trillion, approximately $7.33 billion, in foreign capital inflows. Finance Minister Suahasil Nazara shared this figure during the latest state budget briefing in Jakarta. The majority of foreign funds have been directed into government bonds and securities issued by the central bank. Despite ongoing reductions by overseas investors in Indonesian shares, the Finance Ministry noted that the year-to-date total remains positive.
During 2026, foreign investors invested Rp36.7 trillion, roughly $2.05 billion, in government securities known as SBN. In the first six days of October alone, foreign buyers added nearly Rp8 trillion to government bonds. The demand from nonresident investors for Bank Indonesia Rupiah Securities, or SRBI, was also notably strong. From January 2 to October 8, net foreign settlement inflows into SRBI reached Rp176.50 trillion, according to central bank data.
Capital flows experienced considerable shifts during the first three quarters of 2026. After weaker foreign inflows early in the year, investments increased to Rp140.6 trillion in the second quarter. Activity slowed again in the third quarter but gained renewed momentum at the beginning of the fourth quarter. By October 7, net foreign investment had reached Rp22.01 trillion, about $1.23 billion, as per the latest fiscal update figures.
Most foreign investments target fixed-income assets
In contrast to the bond inflows, Indonesia’s stock market saw a net withdrawal of Rp84.2 trillion, approximately $4.70 billion, from domestic equities so far in 2026. However, increased inflows into bonds and central bank instruments offset these outflows in total. The Finance Ministry identified fixed-income assets as the primary destination for foreign capital. Consequently, government securities and SRBI played crucial roles in maintaining a positive overall flow of foreign funds.
Indonesia’s sovereign bond market also demonstrated a narrowing yield spread against U.S. government debt. The gap between 10-year rupiah bonds and comparable U.S. Treasuries decreased to 188 basis points. Indonesian officials compared this to the spread of around 1,000 basis points approximately twenty years ago. These figures accompany the government’s latest evaluation of the domestic debt markets and offer additional context for the sustained foreign demand for Indonesian government securities during 2026.
Foreign reserves remain above $146 billion in Indonesia
Bank Indonesia reported official foreign exchange reserves of $146.3 billion at the end of September. This was slightly below the $146.5 billion recorded in August. The reserves at that level cover 5.3 months of imports and stay above the international adequacy benchmark of about three months. They also support 5.2 months of combined imports and external debt payments. Movements in the reserve position are influenced by foreign government borrowing, tax revenues, and service income.
The central bank continues to monitor foreign portfolio flows as part of its assessment of the financial and external environment. At its September meeting, Bank Indonesia maintained the benchmark policy rate at 5.75%. During the third quarter, portfolio investments included government global bond issuance and purchases of domestic government securities. The Rp131.1 trillion inflow so far this year highlights the focus of foreign demand on fixed-income markets, while Indonesian equities experienced substantial net foreign selling during the same period.