Foreign investors voice concern over proposed MSCI downgrade for Indonesia
Bank Indonesia Governor Destry Damayanti said financial authorities were coordinating efforts to reassure global investors.
Foreign investors have expressed regret over MSCI’s proposal to lower Indonesia’s stock-market classification, Bank Indonesia Governor Destry Damayanti said at an Indonesian Chamber of Commerce and Industry leadership meeting in Jakarta on 29 October 2026.
Destry said a global investor she met saw considerable potential in Indonesia’s financial markets, supported by a growing economy. The investor considered US equities too risky following technology-driven valuation gains, she said, citing a stock-market value equivalent to 2.4 times US GDP.
According to Destry, the investor was also concerned about the dominance of technology shares and uncertainty over how far their prices could rise. Europe offered an unattractive alternative because of economic instability, high debt ratios and wide budget deficits, she said.
Destry praised the Financial Services Authority’s response to concerns about investor confidence. She said Bank Indonesia and the Financial System Stability Committee had met and were working together to reassure global investors and limit the negative effects of MSCI’s announcement.
CNBC Indonesia reported that the downgrade proposal had prompted foreign capital outflows, putting pressure on the rupiah, which was trading above Rp18,100 per US dollar.
