TEMPO.CO, Jakarta – Bank Indonesia (BI) has expressed its appreciation for credit rating agency Moody’s Investors Service’s decision to upgrade its outlook for Indonesia’s sovereign credit rating from stable to positive. Concurrently, Moody’s has affirmed Indonesia’s investment grade rating of Baa3.
“Improved Moddy’s outlook shows a continued recognition from international agencies of Indonesia’s success in preserving macroeconomic and financial system stability,” BI Governor Agus Martowadojo said in a written statement received by Tempo on Wednesday.
Agus said that the rating reflects a condition which is conducive to a sustainable economic growth amid global and domestic economic challenges. “Therefore, BI will continue to maintain its discipline in macroeconomic management and enhance coordination with the government,” he said.
In its press release, Moody’s named two key drivers of the change in outlook.
Firstly, decline in vulnerability to external shocks which is expected to continue as a result of preservation of macroeconomic stability, revision of fuel subsidies, and investments in domestic manufacturing sectors. Secondly, Indonesia’s lengthening track record of macroeconomic stability and fiscal discipline, together with its measured but ongoing progress on structural economic, fiscal and regulatory reforms, Moody’s said. Moody’s had earlier kept Indonesia’s sovereign credit rating of Baa3 with a stable outlook on January 28, 2017.