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View all search resultsThe outlook for Indonesia's credit rating has dimmed further as Fitch Ratings revised its view to “negative” from “stable”, adding to warnings over policy uncertainty following a similar downgrade from Moody’s.
State Secretary Prasetyo Hadi said on Monday that the government continued to adhere to fiscal rules and had not breached statutory deficit limits, stressing that budget management remained on a prudent footing.
Economists interpret the rating agency’s latest assessment as a serious corrective signal, noting that a downgrade in Indonesia’s credit rating could sharply raise borrowing costs and pile pressure on the rupiah.
Indonesian stocks and currency traded weaker in early trade on Friday after Moody's lowered the country's credit rating outlook, the latest jolt in a turbulent start to the year for Southeast Asia's largest economy.
While the new finance minister has promised not to make any major changes to next year's draft budget and instead focus on fiscal discipline, Sri Mulyani's departure has left markets nervous about her replacement's policy direction.
The global rating agency downgraded the state-owned lender’s inherent creditworthiness to Ba2 citing real risks in its outstanding loans and accrued interest receivables, though it maintained BTN’s overall credit rating at Baa2 with a stable outlook.
The United States lost its last triple-A credit rating from a major agency Friday as Moody's announced a downgrade, citing rising levels of government debt and dealing a blow to Donald Trump's narrative of economic strength and prosperity.
Credit rating agencies warn that a downgrade could be on the horizon if the government struggles to sustain economic growth or allows the fiscal deficit to widen by prioritizing political commitments over prudent financial management.
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