July 15, 2025
When America Spends, Indonesia Gains

Market Commentary
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In early July 2025, the world witnessed a headline making moment: President Donald Trump, back for his second term, signed the Big Beautiful Bill (BBB) into law.

Billed as one of the most ambitious tax cut packages in U.S. history, the bill was hailed by his supporters as pro growth and patriotic.

But for global investors? It sounded an alarm.


Behind the fireworks and slogans, the numbers tell a different story.

The BBB Act is set to widen the U.S. budget deficit by nearly 1% of GDP each year for a decade, adding strain to a Treasury market already losing foreign support.

China, Japan, and other major holders of U.S. debt are pulling back.

The U.S. dollar has already weakened 11% this year, and with de-dollarization picking up pace and “Trade War 2.0” in full swing, the dollar’s long-standing dominance is visibly under threat.

 

But what feels like pressure for the U.S. could be an open door for Indonesia.

At Sucor Sekuritas, we believe this shift marks a turning point for the rupiah.

With global capital seeking refuge from a turbulent U.S. fiscal environment, emerging markets with strong fundamentals are suddenly in focus, and Indonesia stands out.


While Washington prints and spends, Jakarta stays cautious. Over the past three years, Indonesia has consistently kept its fiscal deficit below 3% of GDP, even at the expense of short-term growth. Its trade balance remains solid.

Inflation is under control.

This is discipline, exactly what long-term investors are looking for.


As global capital reallocates, the rupiah is poised to strengthen. Our base case sees it appreciating to Rp15,500 per U.S. dollar by the end of 2025.

And it doesn’t stop at currency. We’re forecasting a rally in Indonesian government bonds, particularly in the 10-year segment, where yields could fall to 5.8% by year end.

Bonds maturing in 2026–2029 may begin a structural bull run, driving lower funding costs and stimulating long-term investment.

 

For equity investors, this shift could ignite foreign inflows into Indonesian markets, especially in rate sensitive sectors like banking, defensive consumer names, and exporters who benefit from a stronger rupiah.

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