Overall, however, market sentiments are still negative. Indonesian earnings reports covering the first quarter of 2015 have been weaker than anticipated and led to ‘panic-selling’ yesterday. Particularly foreign investors have been net sellers. Today, foreign investors recorded net selling of USD $140 million.

Weak Q1-2015 corporate earnings reports are also a sign that Indonesia’s economic growth in the first quarter may be weaker than expected. Investors are also disappointed to see that the Indonesian government has been unable to boost economic growth (yet) through government spending, particularly spending on infrastructure. Several ambitious government infrastructure projects (which are expected to have a multiplier effect on the economy) have been delayed.

Lastly, Indonesia has received plenty of negative press in global media due to the imminent executions of eight foreign drug traffickers and one Indonesian drug trafficker. The foreign drug traffickers consist of two Australians, four Nigerians, one from the Philippines, and one Brazilian citizen. The executions are expected to be carried out within 24 hours.

Jakarta Composite Index (IHSG):

Meanwhile, Bank Indonesia's benchmark rupiah rate (Jakarta Interbank Spot Dollar Rate, abbreviated JISDOR) depreciated 0.43 percent to IDR 12,978 per US dollar on Tuesday (28/04). The rupiah is always tested ahead of a Federal Reserve policy meeting even though market participants do not expect to see signs of a quick US interest rate hike as US economic data have been weak in recent weeks.

Indonesian Rupiah versus US Dollar (JISDOR):

| Source: Bank Indonesia