JAKARTA. Bank Indonesia (BI) noted that the flow of foreign capital out of Indonesia (capital outflow) in the last 5 weeks reached IDR 40.04 trillion, due to the high net sell by foreign investors.

At its peak, in the third week of this month (April 16-18, 2024), capital outflow reached IDR 21.46 trillion. This was caused by the high net sell in the SBN (Government Securities) market which reached IDR9.79 trillion, then in the stock market IDR3.67 trillion, and SRBI (Bank Indonesia Rupiah Securities) IDR8 trillion.

The high capital outflow was also followed by a reduction in the portion of foreign investors' ownership in the SBN market. According to data from the Directorate General of Financing and Risk Management (DJPPR) of the Ministry of Finance, the portion of foreign ownership in the SBN market fell to 13.85% on April 25, 2024, from 14.16% in early April 2024.

Previously, the longest capital outflow rally had occurred for 6 consecutive weeks from August 7 to October 19, 2023. However, the total foreign net sell recorded in the rally was IDR 40.43 trillion.

Sri Mulyani Indrawati, Minister of Finance, admitted that the high capital outflow in the last 5 weeks was the result of the pressure from the high US interest rates. "Because they tend to maintain interest rates, this affects the value of stocks and SBN," said Sri Mulyani, in her official statement last weekend.

According to data compiled by idnfinancials.com, foreign net sell that took place from the beginning of the year to April 25, 2024 was recorded at IDR 47.26 trillion in the SBN market. Meanwhile, foreign capital flows in the stock market and SRBI recorded a net buy of IDR 9.68 trillion and IDR 9.02 trillion, respectively. (KR/LM)