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Credit rating upgrade should boost investor confidence: BI
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The Bank Indonesia (BI) building is located on Jl. MH Thamrin in Central Jakarta. (JP/Wienda Parwitasari)
T
he recent rating upgrade by Moody's Investors Service will boost investors’ confidence in the financial market, according to the head of Bank Indonesia’s financial market research, Nanang Hendarsyah.
“Although it particularly affects the sovereign bond, it will also positively affect other instruments, including corporate bonds,” he said in Jakarta on Friday.
On Friday, Moody’s upgraded its rating for Indonesia’s long-term, foreign currency-denominated debt to Baa2 with a stable outlook, making Indonesia equal to the Philippines and India, Reuters reported.
The rating agency’s confidence was improved after noting Indonesia’s prudent fiscal and monetary policies as well as the strengthening of its capital buffer, suggesting Indonesia’s capacity to withstand shocks was improved.
Nanang called on the private sector to harness the positive momentum generated from the current low interest rate regime and the country’s improved credit ratings.
“The currently low interest rate and good investment-grade ratings are a momentum that needs to be utilized by the private sector,” he said. (bbn)
