JAKARTA, INDONESIA / RankWire.AI / – Through early October 2026, Indonesia attracted Rp131.1 trillion, approximately $7.33 billion, in foreign capital inflows. Finance Minister Suahasil Nazara disclosed this figure during the latest state budget briefing held by the government in Jakarta. The majority of foreign investments were directed into government bonds and securities issued by the central bank. Despite foreign investors gradually reducing their holdings in Indonesian equities, the Finance Ministry emphasized that the total inflow for the year remains positive.
Foreign investors allocated Rp36.7 trillion, roughly $2.05 billion, into government securities known as SBN throughout the year. During the first six days of October alone, foreign buyers added nearly Rp8 trillion in government bonds. Additionally, Bank Indonesia’s Rupiah Securities, or SRBI, continued to see robust demand from nonresident investors. According to central bank data, net foreign settlement inflows into SRBI reached Rp176.50 trillion from January 2 to October 8.
The pattern of capital movement changed notably across the first three quarters of 2026. Initially, Indonesia experienced weaker foreign capital flows early in the year, but inflows surged to Rp140.6 trillion in the second quarter. Investment momentum then slowed during the third quarter, only to pick up again at the start of the fourth quarter. By October 7, net foreign investment totaled Rp22.01 trillion, approximately $1.23 billion, as per the latest fiscal data presented.
Most foreign investment goes into fixed-income assets
The Indonesian stock market followed a different trend during this period, with foreign investors withdrawing a net Rp84.2 trillion, or about $4.70 billion, from local equities year to date. These withdrawals were offset by strong inflows into bonds and central bank instruments, which kept the overall foreign capital flow positive. The Finance Ministry highlighted fixed-income assets as the primary target for overseas funds, with government securities and SRBI accounting for the bulk of foreign investment that sustained the positive total.
The conditions in Indonesia’s sovereign bond market also reflected a narrower yield gap against U.S. government debt. The spread between 10-year rupiah bonds and similar U.S. Treasuries decreased to 188 basis points. Officials in Indonesia compared this spread to levels of around 1,000 basis points approximately twenty years ago. These figures accompany the government’s latest review of the domestic debt market, providing further context for the sustained foreign interest in Indonesian government securities throughout 2026.
Indonesia’s foreign reserves stay above $146 billion
Bank Indonesia announced that its official foreign exchange reserves totaled $146.3 billion at the end of September, slightly below the $146.5 billion recorded a month earlier. The September reserve level covers 5.3 months of imports and exceeds the international adequacy standard of about three months. It also covers 5.2 months of combined imports and external debt payments. Movements in the reserve position are influenced by foreign government borrowing, tax revenue, and service income.
The central bank has closely monitored foreign portfolio flows as part of its assessment of external and financial conditions. At its September meeting, Bank Indonesia maintained its benchmark policy rate at 5.75%. During the third quarter, portfolio investments included government global bond issuances and purchases of domestic government securities. The year-to-date inflow of Rp131.1 trillion demonstrates that foreign demand remains concentrated in fixed-income markets, while Indonesian equities experienced ongoing substantial net foreign sales during the same period.