- Indonesia's BoP recorded a USD 6.1 Bn surplus in Q4-25, a reversal after three quarters of deficits. The surplus was primarily driven by USD 8.2 Bn in inflows into the financial account, which compensated for the USD 2.5 Bn deficit in the current account.
- The FA recovery was fueled by inflows across all instruments. However, the FA's short-term outlook faces pressure from global rating agencies, while the medium-term outlook remains mixed with potential catalysts from a capital rotation from AI stocks and the latest deal with the US.
- Risks such as limited US rate cuts, rising global inflation, and a higher global fiscal deficit are expected to constrain portfolio inflows and make it unlikely for Bank Indonesia to lower rates in the first half of 2026.
