Indonesia’s stocks fall, currency weakens as protests dent sentiment

Indonesia faces a harsh political climate because it struggles with its rising living costs, the salary of MPs and the police violence, in the largest economy of Southeast Asia, with its protests that it damages the investor thought.

According to LSEG data, the Jakarta Composite Index fell to 3.6% on Monday, while Indonesia Rupiah touched on the weakest day -day level since August 1st.

Although violence and protests shake the trust of investors, several market observers are likely to challenge the growth story underlying Indonesia.

Most recently, Sellloff said that it was first “sensitivity -oriented” because investors reacted to the weekend developments.

Indonesia is still one of the more stable developing markets. “At this point I don’t think it completely changed the story.”

According to OCBC Bank FX Analyst Christopher Wong, close -term potential softness for Rupiah is probably expected to be temporary and probably reversed when internal uncertainties disappear. He refused to make more precise estimates by referring to increasing uncertainty.

Some Indonesian students and non -governmental groups were unclear whether the demonstrations in Jakarta or other cities, who called protests to avoid a violent increase by the authorities, would continue on Monday.

Macquarie Capital Indonesian Research President Ari Jahja said investors will follow the next steps to meet the government’s demands and increase market confidence. “Indonesia may occur stronger if structural reforms are made on the slightly positive side.”

DBS economist Radhika Rao admitted that long -term growth drivers remained intact for Indonesia. Investors said that some of Jakarta’s expenditure cuts will be directed to alleviating unemployment, and that the government will follow any symptoms of growth and increasing jobs.

The bank said that Indonesia still has a large area to keep politics host, she expects the Central Bank to take steps to calm the markets and take steps to support rupees when it is due.

According to LSEG data, the returns of Indonesia’s 10 -year state bonds rose to 6,335 on Monday.

Housing allowances of MPs Minimum Monthly 10 times the country At a time when the tax hike, dismissal and inflation hit low -income Indonesians, the wage is the key to stopping the public’s anger.

After becoming a motorcycle taxi driver, discontent with economic distress became a wider anger. reported killed during the police action Last Thursday protest site. This started a violent wave of protests in a few Indonesia, calling for a police reform.

The protests intensified at the weekend, targeting the houses of the rebels of the deputies, arms and looting and burning of the property, targeting government buildings Media Reports. Hundreds of people reported Finance Minister Sri Mulyani’s residence in South Tanggerang forced valuable items.

Indonesian President Prabowo Subioglu said that on Sunday, the country’s parliament will listen to and act by promising to block heavy allowances for deputies.

Indonesia, the fourth largest economy of the world with a population of 284 million, was seen as one of the most stable economies in Southeast Asia. The last protests that killed at least five and injured hundreds of people have created the worst crisis for the country since Subio’s office began to work about a year ago.

Political Counseling Teneo General Manager Bob Herrera -lim, “This moment represents an important test for Prabowo’s approach to the opposition.” He said. He said: “The President may concern that continuing to space on the streets for more than a few days to encourage his government to emerge to challenge.”

The President warned that the firm will be taken against violent demonstrators. “We cannot deny that the army and the police to take harsh action against rebels and looters,” We cannot deny that the illegal, even illegal actions have begun to emerge, and some lead to betrayal and terrorism. ” He said.