JAKARTA – Finance Minister Purbaya Yudhi Sadewa has moved to reassure investors following a sharp decline in the Jakarta Composite Index (JCI) and a depreciation of the rupiah on Monday, May 18, 2026. Addressing market volatility during his visit to the Halim Perdanakusuma Air Force Base, the minister emphasized that the downturn is merely a short-term reaction rather than a sign of structural failure.
Despite the JCI opening in the 6,400 range and the rupiah weakening to Rp17,600 against the US dollar, Purbaya urged market participants to remain calm. He noted that Indonesia’s economic fundamentals remain robust, asserting that the current market pressure is driven by temporary sentiment rather than deeper systemic issues.
Strategic Intervention in the Bond Market
To combat the instability, the government is taking proactive measures. Purbaya confirmed that the state will begin a more aggressive intervention in the bond market starting immediately. This move is designed to stabilize yields and restore investor confidence, preventing a potential sell-off of government securities caused by fears of capital losses.
“We are entering the bond market more significantly starting today to ensure it remains under control,” Purbaya stated. He added that while the market is currently experiencing a correction, the government is actively monitoring the situation and preparing additional policy measures to be announced in the coming week.
Distinguishing Current Volatility from Past Crises
Addressing concerns that the rupiah’s weakness could mirror the 1997–1998 Asian Financial Crisis, the Minister firmly rejected such comparisons. He highlighted that unlike the conditions during that era, Indonesia’s current economy is still experiencing strong growth and is nowhere near a recession.
“Comparing this to 1997–1998 is inaccurate. Back then, we faced policy errors and significant socio-political instability following a recession. Today, our economy is still growing rapidly, providing us with ample room to rectify these short-term market fluctuations,” he explained.
Market Outlook: A Potential Rebound
Purbaya expressed optimism regarding the potential for a quick recovery, suggesting that the current technical correction in the stock market could reverse within a matter of days. He encouraged investors to avoid panic-selling, hinting that the government’s upcoming policy interventions will help solidify market stability.
“Based on the technical data, I expect the market to bounce back within a day or two. There are further measures being prepared, and we will share those details next week,” he concluded with confidence.
Summary
Finance Minister Purbaya Yudhi Sadewa has assured investors that the recent decline in the Jakarta Composite Index and the depreciation of the rupiah are merely temporary market reactions. He emphasized that Indonesia’s economic fundamentals remain robust and rejected comparisons to the 1997–1998 financial crisis, noting that the economy is currently experiencing strong growth rather than a recession.
To stabilize the market, the government has initiated aggressive interventions in the bond market to restore investor confidence and manage yields. Minister Purbaya expressed optimism for a quick market rebound, advising against panic-selling while confirming that additional policy measures are being prepared for announcement in the coming week.
