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apital inflows are lending support to the rupiah and stoking confidence in the currency as Indonesia'€™s economy is pulsating again.

The Indonesian Stock Exchange (IDX) reported on Friday that total net buys in the stock market reached Rp 1.53 trillion (US$114.06 million) since the beginning of this year.

In the secondary government bond (SBN) market, data from the Finance Ministry'€™s financing and risk management office (DJPPR) show that ownership by non-residents '€” including foreign governments and central banks '€” have remained solid as well.

Non-residents held Rp 592.12 trillion-worth of debt papers as of Feb. 24, accounting for 39 percent of the total.

The inflows have helped the rupiah strengthen against the greenback. The currency closed at 13,389 per US dollar on Friday, appreciating by 0.9 percent within a week.

Since the end of last year, the rupiah has strengthened by 3 percent, making it one of the best-performing currencies in Asian emerging markets.

Many attribute the bright picture to the government'€™s string of economic reform measures, which Macquarie Bank foreign exchange and rates strategy head Nizam Idris said were central in supporting the rupiah.

'€œIn an environment of global turmoil, investors are likely to put a premium on economies with a good domestic story. Indonesia is shaping up nicely to be one of these, and the rupiah could benefit,'€ he wrote in an email.

The current administration began reforming the economy when it scrapped fuel subsidies in November 2014 and redirected the funds toward infrastructure. It added further measures in numerous economic policy packages since September 2015.

Ten packages have been issued so far, the latest of which removes barriers to foreign investment in certain economic activities through a revision of the so-called negative investment list.

The government and central bank brought down inflation last year and prevented the economy from faltering further amid a global slowdown, with the gross domestic product (GDP) standing at 4.79 percent.

On Friday, Finance Minister Bambang Brodjonegoro said he expected the country'€™s currency to maintain strong this year at a level of 13,200 to 13,500 per dollar.

Bambang also said he expected the Indonesian economy to improve in 2016, blaming its weak export performance in 2015 on the slowdown in China and low global commodity prices.

'€œWe think this year we can grow by more than 5 percent, hopefully at the 5.3 percent rate estimated in our budget,'€ he was quoted by Reuters.

'€œ[The] budget deficit last year was quite okay at 2.53 percent [of GDP]. This year it was originally [planned at] 2.15 percent, but if necessary, we can widen our deficit a little bit, to a maximum of 2.5 percent,'€ the minister said.

Meanwhile, global fund managers are seeing the turnaround as well.

American BlackRock Inc., the world'€™s largest money manager, and Franklin Templeton Investments, the fifth-largest actively managed fixed-income fund in the world, are recommending selective buying of emerging-market bonds.

In a blog post, Templeton'€™s chief investment officer for global macro, Michael Hasenstab, said opportunities were still available in several countries, such as Indonesia, Malaysia, South Korea, Mexico and the Philippines.

The latest developments in the US appear to have contributed to the positive movement of the rupiah.

CIMB Niaga'€™s head of treasury sales, Sjarif Gunawan, pointed to data suggesting that tightening of the US federal funds rate might not happen as fast as initially expected and that the market had scaled down its expectations to just two US interest rate hikes this year.

Meanwhile, several experts, including former finance minister Chatib Basri and Capital Economics'€™ economists Gareth Leather and Daniel Martin, said Indonesia should not get carried away with positive sentiment.

Chatib warned that a lot of the recent inflows supporting the rupiah were '€œhot money'€ that could leave anytime. Also, the strengthening of the currency could trigger higher imports and lead to a widening current account deficit.

'€œWe have at least two years to prepare ourselves for a possible capital flow reversal. In two years, [the Federal Reserve'€™s governor] Janet Yellen will have to raise interest rates,'€ said Chatib, who now serves as Mandiri Institute chairman.