FX.co ★ Moody's Revises Indonesia Credit Outlook to Negative

Moody’s Investors Service adjusted Indonesia’s sovereign credit rating outlook from stable to negative on February 5, 2026, while maintaining the Baa2 rating. This change reflects concerns over policy credibility. Moody’s pointed out that diminished predictability and alignment in policymaking, along with less effective communication of these policies, have heightened risks to policy credibility. This scenario could potentially weaken governance, economic performance, and fiscal stability. Such concerns are mirrored by increased volatility in both equity and foreign-exchange markets, which, if it continues, could compromise Indonesia’s traditionally strong policy credibility—a cornerstone of the nation's robust economic growth and macroeconomic stability. Despite these concerns, the Baa2 rating rests on Indonesia’s enduring structural strengths, which include abundant natural resources, a favorable demographic profile, and sound fiscal and monetary policies, all of which bolster medium-term growth prospects. Meanwhile, Standard & Poor’s credit rating for Indonesia remains at BBB, with a stable outlook.