Indonesia today must navigate not only the visible waves of global headwinds but also the quieter currents of domestic discontent and structural vulnerability. And yet, as history often reminds us, it is in these periods of turbulence that a country’s economic maturity is truly measured.

Over the past several weeks, market volatility, fiscal concerns and sluggish domestic demand have combined to create a narrative of uncertainty.

The Jakarta Composite Index (JCI) has declined nearly 20 percent since late 2024, the rupiah has weakened beyond Rp 16,600 against the United States dollar – levels last seen during the Asian Financial Crisis – and capital outflows have reached Rp 28 trillion (US$1.675 billion)

For many observers, these developments paint a bleak picture. But a deeper look reveals an economy at a crossroads, facing temporary turbulence but underpinned by structural resilience.

Part of the current financial pressure stems from global monetary conditions.

The US Federal Reserve’s decision to maintain its policy rate at 4.25–4.50 percent has sustained a "higher-for-longer" global rate environment. This has driven US Treasury yields, particularly the 10-year note, to hover above 4.3 percent – a level that continues to attract global capital back to US assets.