The sluggish global economy, led by the economic slowdown of China, impacts on Indonesia's export performance as commodity prices remain hovering at 4.5-year lows. Meanwhile, global uncertainties remain omnipresent due to uncertainty about the timing of higher US interest rates (a monetary move that will trigger heavy capital outflows from emerging markets, including Indonesia). Although having recovered over the past couple of weeks, as markets expect a delay in higher US interest rates until next year, the rupiah is still down 8.4 percent against the US dollar so far this year, making it the worst-performing Asian currency in 2015 after Malaysia's ringgit. With prospects of another round of heavy pressure on the rupiah (when speculation about a US interest rate hike increases) it makes an IPO on the Indonesia Stock Exchange less attractive.

Indonesian Rupiah versus US Dollar (JISDOR):

| Source: Bank Indonesia

China's economic growth is expected to remain in the range of 6-7 percent in the coming years. Last week, the central bank of China cut its interest rates for a sixth time within a 12 month period in a bid to boost growth which is heading for a 25-year low in 2015. In the third quarter of 2015, China's economy expanded by 6.9 percent (y/y), the lowest growth pace since the financial crisis in the late 2000s.

Indonesia's economic growth is expected to accelerate in the third quarter and fourth quarters of 2015 from the six-year low of 4.67 percent (y/y) in Q2-2015, partly supported by the government's recently unveiled series of economic stimulus packages. However, given that these packages were implemented in September-October the real impact should be felt next year.

Bank Indonesia is expected to keep its benchmark interest rate high at 7.50 percent ahead of higher US interest rates, hence limiting credit expansion. However, there may be some scope for a cut as the country's inflation is expected to ease to 3.6 percent (y/y) by the year-end, while the current account deficit may improve to around 2 percent of gross domestic product (GDP) for full-year 2015.

Today, Mitra Komunikasi Nusantara was listed on the IDX. After opening of trade, shares of the company jumped 70 percent.

Next year, the Indonesia Stock Exchange expects to see 35 IPOs on the exchange (including several state-owned companies) on the back of improved economic conditions.