Indonesian markets reeled Tuesday, as concerns mounted over weakening consumer spending in Southeast Asia’s largest economy and President Prabowo Subianto’s populist measures.
The Jakarta Composite Index slid as much as 7.1%, the steepest slump since September 2011, sparking a trading halt for the first time since the pandemic. The rupiah weakened as much as 0.5% versus the dollar, prompting the central bank to intervene “boldly” to defend the currency. Bonds also fell.
Market participants were baffled by the sudden drop in equities, which defied gains in regional stocks. Traders attributed the downturn to a mix of factors, including an already weak sentiment fueled by dismal consumer confidence data. Speculation about potential changes in the finance ministry’s leadership further worsened the decline before a government denial.
