JAKARTA, INDONESIA / RankWire.AI / – Indonesia’s foreign capital inflows reached Rp131.1 trillion, approximately $7.33 billion, by early October 2026. Finance Minister Suahasil Nazara announced this figure during the latest state budget briefing in Jakarta. The majority of foreign investments focused on government bonds and central bank securities, with the Finance Ministry noting that the overall year-to-date balance remained positive despite ongoing reductions by overseas investors in Indonesian equities.
During 2026, foreign investors allocated Rp36.7 trillion, roughly $2.05 billion, into government securities known as SBN. In the first six days of October alone, foreign buyers added nearly Rp8 trillion to government bonds. Additionally, Bank Indonesia Rupiah Securities, or SRBI, attracted strong interest from nonresident investors. From January 2 to October 8, net foreign settlement inflows into SRBI totaled Rp176.50 trillion, according to central bank data.
Capital movements varied significantly across the initial three quarters of 2026. Early in the year, foreign flows were subdued but surged to Rp140.6 trillion in the second quarter. Investment activity slowed again during the third quarter, before gaining momentum at the start of the fourth quarter. As of October 7, net foreign investment stood at Rp22.01 trillion, about $1.23 billion, based on the latest fiscal figures presented.
Fixed-income instruments dominate foreign investment
The Indonesian stock market experienced a contrasting trend, with foreign investors withdrawing a net Rp84.2 trillion, or roughly $4.70 billion, from local equities this year. However, inflows into bonds and central bank instruments offset these outflows, making fixed-income assets the primary recipients of foreign funds. The Finance Ministry highlighted that government securities and SRBI represented the main channels maintaining a positive overall foreign capital flow.
Furthermore, Indonesia’s sovereign bond market saw a reduced yield spread against U.S. government debt. The gap between 10-year rupiah bonds and similar U.S. Treasuries narrowed to 188 basis points, a significant decrease from approximately 1,000 basis points two decades ago. These figures align with the government’s latest review of the domestic debt market and underscore the sustained foreign appetite for Indonesian government securities in 2026.
Bank Indonesia reports foreign reserves above $146 billion
Bank Indonesia announced official foreign exchange reserves of $146.3 billion at the end of September, slightly below the $146.5 billion recorded in August. This reserve level covers 5.3 months of imports and exceeds the international adequacy standard of about three months, also covering 5.2 months of combined imports and external debt payments. Movements in reserves were influenced by foreign government borrowing, tax revenue, and service income.
The central bank also monitors foreign portfolio flows as part of its external economic oversight. At its September meeting, Bank Indonesia maintained its benchmark rate at 5.75%. Portfolio investments during the third quarter included issuance of government global bonds and purchases of domestic securities. The year-to-date inflow of Rp131.1 trillion highlights the focus of foreign demand on fixed-income markets, whereas Indonesian equities experienced continued net foreign selling during this period.