JAKARTA, INDONESIA / RankWire.AI / – In Jakarta, early October 2026, Indonesia’s foreign capital inflows totaled Rp131.1 trillion, approximately $7.33 billion. Finance Minister Suahasil Nazara disclosed this figure during the government’s latest state budget briefing. The majority of foreign investments flowed into government bonds and securities issued by the central bank. Despite foreign investors reducing their holdings in Indonesian shares, the Finance Ministry stated that the year-to-date total remains positive.
During 2026, foreign investors allocated Rp36.7 trillion, roughly $2.05 billion, into government securities known as SBN. In the first six days of October alone, foreign buyers added nearly Rp8 trillion to government bonds. Additionally, Bank Indonesia’s Rupiah Securities, or SRBI, experienced strong demand from nonresident investors. As per central bank data, net foreign settlement inflows into SRBI totaled Rp176.50 trillion from January 2 to October 8.
Capital flows in Indonesia saw notable shifts across the initial three quarters of 2026. Early in the year, foreign inflows were relatively weak, but during the second quarter, they increased to Rp140.6 trillion. Investment activity slowed again in the third quarter, only to regain momentum at the start of the fourth quarter. By October 7, net foreign investment had reached Rp22.01 trillion, or about $1.23 billion, according to the latest fiscal data presented during the update.
Fixed-income assets dominate foreign investment activity
In contrast, Indonesia’s stock market experienced a different trend during the same period. Foreign investors withdrew a net Rp84.2 trillion, or approximately $4.70 billion, from domestic equities year to date. However, substantial inflows into bonds and central bank instruments offset these withdrawals, maintaining overall positive foreign capital flows. The Finance Ministry identified fixed-income assets as the primary destination for overseas funds, with government securities and SRBI playing key roles in this performance.
The conditions in Indonesia’s sovereign bond market also reflected a narrower yield gap compared to U.S. government debt. The spread between 10-year rupiah bonds and similar U.S. Treasuries shrank to 188 basis points. Indonesian officials compared this figure to spreads of around 1,000 basis points approximately twenty years ago. These figures accompany the government’s latest review of the domestic debt markets and offer context for the sustained foreign demand for Indonesian government securities during 2026.
Indonesia’s foreign reserves stay above $146 billion
Bank Indonesia announced official foreign exchange reserves of $146.3 billion at the end of September, slightly below the $146.5 billion recorded in August. This reserve level covers 5.3 months of imports, exceeding the international adequacy standard of about three months. It also covers 5.2 months of combined imports and external debt payments. Movements in the reserve position are also influenced by foreign government borrowing, tax revenues, and service income.
Bank Indonesia continues to monitor foreign portfolio flows as part of its assessment of external and financial conditions. The central bank maintained its benchmark policy rate at 5.75% during its September meeting. Portfolio investments in the third quarter included issuance of government global bonds and purchases of domestic government securities. The year-to-date inflow of Rp131.1 trillion highlights the concentrated demand from foreign investors in fixed-income markets, while Indonesian equities saw continued net foreign selling during this period.