Indonesia Stocks Rise as Investors Watch Fed Policy

Indonesia's benchmark stock index, the Jakarta Composite Index (JCI), saw an increase on Thursday morning, driven by investor attention to global interest rate policies. The JCI opened 0.26 percent higher at 5,709.84, with the blue-chip LQ45 index also rising by 0.46 percent.

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Based on technical analysis, we see the JCI has limited potential for strengthening, with support and resistance levels of 5,320-5,735. A correction is still possible, so please remain cautious.

Despite the morning gains, analysts express caution. Maximilianus Nico Demus of Pilarmas Investindo Sekuritas noted that the JCI has limited potential for further strengthening, with support and resistance levels between 5,320 and 5,735. He warned that a correction is still possible, advising investors to remain vigilant.

Globally, Federal Reserve Chairman Kevin Warsh indicated that inflation risks have eased, aligning with the Fed's 2 percent inflation target. This stance has led to stalled bond yields and a downward trend. Warsh also emphasized the Fed's independence from political pressure, despite calls for rate cuts from U.S. President Donald Trump.

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Because currently, energy and gasoline prices continue to decline, due to the good news regarding the United States (US)-Iran agreement.

Domestically, recent economic data presents a mixed picture. The Central Statistics Agency reported monthly inflation of 0.44 percent in June 2026, contributing to a year-to-date inflation of 1.79 percent and an annual rate of 3.34 percent. This increase was attributed to seasonal factors, rising raw material prices, and fuel price hikes. Furthermore, Indonesia's trade balance recorded a deficit of US$1.61 billion in May 2026, the first in six years, as imports surpassed exports. Nico highlighted growing pressure on Indonesia's external sector due to slowing exports amid weakening global demand and falling commodity prices, though increased imports of raw materials and capital goods could support domestic production and investment.

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Pressure on Indonesia's external sector is starting to increase, primarily due to slowing exports amid weakening global demand and falling prices for several leading commodities.