IDX - What's The Catch With Indonesia?
By Alberto J. Boquin, CFA
From where we stand today, there are a handful of emerging markets (EMs) where 10-year local-currency bonds yield 8-9%: Brazil, Indonesia, Mexico, Russia, South Africa, and Turkey. Mexico and Turkey are still dealing with inflationary pressures which forced their central banks to tighten policy in 2018. Brazil and South Africa are under new leadership that has yet to address fiscal sustainability issues. Russia continues to face sanctions risk. Meanwhile, Indonesia exhibits below-target inflation, a solid investment grade profile, and few geopolitical headlines. So, what's the catch with Indonesia? Is there