Antara News·Indonesia·Monday, October 5, 2026 at 10:23 AM UTC

Indonesia's financial sector remains stable amid global risks: OJK

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Rizka Khaerunnisa, Raka Adji

..the OECD raised its 2026 economic growth forecast for Indonesia by 0.5 percentage points.

Jakarta (ANTARA) - The Indonesian financial services sector remains stable amid global geopolitical uncertainty and global monetary tightening, according to the Financial Services Authority (OJK) following its September 2026 Monthly Board of Commissioners Meeting.

Speaking at an online press conference in Jakarta on Monday, OJK Board of Commissioners Chair Friderica Widyasari Dewi explained that global economic growth in 2026 is projected to be lower compared to 2025.

Although lower than last year's growth, the latest forecast represents an improvement from previous projections, supported by increased investment and trade driven by developments in artificial intelligence (AI).

However, she noted that sustaining this growth momentum faces challenges from rising global inflation, fueled by escalating geopolitical conflicts that have pushed oil prices higher again, as well as a "very strong" El Niño pattern that could drive up food and agricultural commodity prices.

Friderica added that rising inflation has prompted "higher-for-longer" global interest rate policies, with rate hikes in some countries and regions such as United States, Europe, and Japan. Markets are anticipating further increases in late 2026 and into 2027.

Government bond yields have also surged to decade highs, with yields in the United States and Europe returning to levels seen before the 2008 global financial crisis, while Japanese yields have returned to levels last seen before 1997.

The increase has also been influenced by high government financing needs and a surge in long-term bond issuance by hyperscalers—large-scale cloud and technology providers—to fund AI-related investments.

Domestically, Friderica said recent indicators point to strong economic conditions, with inflation remaining stable.

Stable inflation has helped sustain domestic demand and consumer spending, supporting national economic growth.

In line with this momentum, the OECD raised its 2026 economic growth forecast for Indonesia by 0.5 percentage points.

"This clearly reflects global confidence in the resilience of the national economy," Friderica said.

She added that the positive trend is supported by a financial sector that continues to contribute to economic growth, alongside sustained financial stability underpinned by solid industry fundamentals.

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