Airlangga links rupiah slide to MSCI downgrade proposal

Indonesia’s Coordinating Minister for Economic Affairs Airlangga Hartarto attributed declines in the rupiah and domestic shares to MSCI’s proposal to move the country’s stock market from emerging-market to standalone status. Speaking in Jakarta on 16 October 2026, he said the announcement had come earlier than expected.

The Jakarta Composite Index ended the first trading session at 5,233.00, losing 630.78 points, or 10.76 per cent, after the proposal emerged. The rupiah stood at Rp18,037 per US dollar at 12.48 WIB.

Shares had already opened lower at 5,393.92 at 09.00 WIB, a decline of 8.01 per cent. The benchmark subsequently touched a low of 5,193.22, while its highest level was 5,404.51.

Airlangga said MSCI had indicated that its announcement would come in November 2026. He attributed the proposed reclassification to MSCI’s view that implementation of previously promised capital-market regulatory measures was taking too long, and said the reasons for that timetable needed explaining.

He said reforms must proceed and their progress must be visible to both domestic and foreign investors. Airlangga also said he would coordinate with the Indonesia Stock Exchange on risks and responses to MSCI’s assessment, seeking concrete measures and a timetable.