Indonesia’s Sovereign Credit Rating Affirmed at BBB by S&P, Supported by Prudent Fiscal Policy and Commodity Strategy
Main Takeaways
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JAKARTA, Investortrust.id — S&P Global Ratings has reaffirmed Indonesia’s sovereign credit rating at BBB with a stable outlook, maintaining the nation’s position one notch above the lowest investment grade.
The announcement, made on Tuesday, July 29, 2025, reflects international confidence in Indonesia’s economic resilience, supported by strong growth prospects, disciplined fiscal management, and relatively low levels of net external and government debt.
S&P cited the government’s adherence to a fiscal deficit ceiling of 3% of GDP as a key anchor of fiscal sustainability. In addition, the continued expansion of Indonesia’s downstream industrial strategy—particularly in mineral processing—has helped maintain external stability, contributing to the stable outlook.
Bank Indonesia Governor Perry Warjiyo welcomed the decision, calling it “a reflection of strong confidence from international stakeholders in Indonesia's macroeconomic stability and robust economic prospects.”
“This confidence is supported by prudent policy settings and the effective synergy of the policy mix between the Government and Bank Indonesia amid ongoing global uncertainties,” Warjiyo said. S&P last affirmed the same rating and outlook on July 30, 2024.
Risks and Opportunities for a Future Upgrade
While the outlook remains stable, S&P noted that upward momentum in Indonesia’s rating could materialize if the country demonstrates a stronger capacity to service external debt. This could be achieved through higher export revenues or lower reliance on foreign financing.
Conversely, the rating could face downward pressure if certain fiscal thresholds are persistently breached. These include the government debt-to-GDP ratio exceeding 3% in a sustained manner, interest payments on public debt rising above 15% of state revenues, or a prolonged and structural decline in export earnings.
Bank Indonesia Reaffirms Policy Commitment
Bank Indonesia emphasized its commitment to supporting macroeconomic stability through effective monetary policy. The central bank will continue efforts to keep the rupiah exchange rate stable and inflation within the target corridor, while also nurturing growth.
“Going forward, Bank Indonesia will continue to strengthen policy synergy with the Government to maintain stability and foster economic growth in line with the Government's Asta Cita program,” the statement read, referring to President Prabowo Subianto’s eight-point national agenda.
The central bank also reaffirmed its collaboration with the Financial System Stability Committee (KSSK) to ensure the health of Indonesia’s broader financial system.
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