- The strong demand for Indonesian government bonds in 2022-2023 appears to be primarily driven by state-run insurance firms and pension funds, with contributions from the private sector being more limited.
- The substantial accumulation of SBN in state-run insurance and pension funds’ portfolios seems to crowd out liquidity from other asset markets.
- The domestic non-bank investors’ already negative liability growth, combined with the expected increase in issuance in the upcoming periods, could put upward pressure on the yield of Indonesian government bonds.
