S&P Global Maintains Indonesia Investment Grade Rating

• S&P affirmed Indonesia's BBB rating, pinning the slowdown on temporary external factors.

• Recovery depends on commodity prices, spending efficiency, and maintaining the 3% deficit ceiling.

By  Aathirra Noortyanisa Noersamjah, Keisha Auryn Rasindrea Gantari, Mochamad Gibran Ramadhan, Haidar Zeeka Fachrezi 

July 17, 2026 at 16:30 GMT+7

S&P Global Ratings affirmed Indonesia’s long-term sovereign credit rating at BBB with a stable outlook and its short-term sovereign credit rating at A-2, in a report released on Monday (07/13). Read more: Apple to Invest US$30 Billion in Broadcom Chips S&P Global Ratings stated that Indonesia’s economic indicators have weakened in recent months, with the agency expecting the slowdown to be temporary and a gradual improvement in the upcoming years. According to S&P, the weakening is driven by external pressures, notably the rise in global energy prices and the depreciation of the rupiah. 

Despite these pressures, S&P reaffirmed Indonesia’s sovereign credit rating and stable outlook, reflecting S&P’s view that the slowdown is driven by temporary external headwinds rather than underlying structural weaknesses.

S&P Global Headquarters | Source: Kontan

S&P Global  Ratings noted that rising commodity prices and more efficient government spending are expected to mitigate the impact of elevated global energy prices and a weaker rupiah. Read more: Danantara Merged 7 State-Owned Logistics Firms S&P also highlighted the government's efforts to centralize management and reduce leakages in the natural resources and minerals sector; these efforts are projected to bolster state revenue and export performance if successfully executed.

The stable outlook is supported by S&P's assessment that recent fiscal instability and external pressures are temporary, backed by expectations that the government will keep its 3% of GDP deficit ceiling as a crucial policy anchor.

Finance Minister Purbaya believes stock investors can now feel confident, following S&P's decision to keep Indonesia's credit rating at BBB with a stable outlook. | Source: CNN

S&P Global Ratings stated that Indonesia's sovereign credit rating could face a downgrade if the net government debt continues to swell, the fiscal deficit exceeds 3% of GDP, the interest expenses surpass 15% of government revenue, or exports weaken structurally. Read more: SpaceX to Acquire Cursor for US$60 Billion Alternatively, a rating upgrade could occur if Indonesia’s external and fiscal indicators show a fundamental improvement. 

Additionally, S&P validated the country's credit profile by affirming its foreign currency rating at BBB/Stable/A-2, the local currency rating at BBB+, and the senior unsecured rating at BBB, indicating that the current structural stability remains sufficient to offset potential downside fiscal pressures.

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Sources: CNBC IDNFinancials Reuters