06 August 2025
In July, JCI rose steadily, printing 9% growth since end of June. The rise was driven by exotic names, while traditional big caps such as banks have remain laggard. Foreign flow has improved compared to the end of June, but has not printed a net positive yet. Despite this, Indonesia has achieved several positive catalysts in the month, including rate cut, US tariff deal, and I-EU CEPA, all of which are believed to drive up the domestic index.
The 25bps rate cut by BI came in time to support domestic growth, with a commitment to further boost domestic growth injecting the market with optimism. The new milestone of I-EU CEPA allows 80% of Indonesian goods to enjoy tariff-free access into the EU, with the agreement itself to be signed by September. Lastly, Indonesia has also concluded a deal with the US regarding its tariffs, obtaining a 19% rate from the previous 32%.
As a result of all these factors, the market is expecting to see an improvement in Indonesian economy by the 2H25, in the form of improved purchasing power and increased utilisation rate of domestic companies. Purchasing power was driven even further by continued stimulus disbursed in July, amounting to approx. IDR24tn. The US deal also placed Indonesia in a more attractive light relative to peer countries, given that the only country to have a lower US tariff than Indonesia is Japan. Neighboring countries such as Malaysia and Vietnam are hit with 25% and 20% tariffs, and only the Philippines matches Indonesia at 19%.
Product Recommendation
| EQUITY FUND | |
|---|---|
| MITRA A | MITRA invests in majority domestic stocks, with a focus on Big Cap stocks. Categorized as a Long-Term investment with high risk. Investors bear the risk associated with the equity portfolio. |
| MICB A | MICB primarily invests in stocks included in the LQ45 index. Categorized as a Long-Term investment with high risk. Investors bear the risk associated with the equity portfolio. |
| BALANCED FUND | |
| MIA | MIA invests in Equities, Bonds and Money Market with Medium Term and categorized Medium Risk. Investors bear the risk associated with the equity portfolio. |
| MISB | MISB invests in Sharia Equities, Sukuk and Money Market Sharia with Medium Term and categorized Medium Risk. Investors bear the risk associated with the equity portfolio. |
| EQUITY INDEX AND ETF FUND | |
| FTSE ESG A | FTSEESG primarily invests in stocks included in the FTSE Indonesia ESG Index. Categorized as a Long-Term investment with high risk. Investors bear the risk associated with the equity portfolio. |
| XMLF | Mandiri ETF LQ45 is an ETF that invests in blue-chip stocks listed in the LQ45 Index. Categorized as a Long-Term investment with high risk. Investors bear the risk associated with the portfolio of these stocks. |
For More Information
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Mandiri Investasi Website – www.mandiri-investasi.co.id
DISCLAIMER
The opinions expressed in the article are for general informational purposes only and are not intended to provide specific advice or recommendations for individuals or specific mutual fund or investment products. It is intended solely to provide education about the financial industry. Views reflected in the content may change at any time without notice. All performance data and investment returns mentioned in this article cannot be used as a basis for calculation to buy or sell a mutual fund. This data is performance records based on historical data and is not a guarantee of future mutual fund performance. Investment through mutual funds carries risks. Investors are required to read and understand the prospectus before deciding to invest through mutual funds.
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