In March 2025, the Indonesian equity market faced significant volatility due to a confluence of domestic and international factors. The Jakarta Composite Index (JCI) declined by approximately 8% since the beginning of the year, reflecting investor apprehension.

Internationally, escalating global trade tensions, particularly the imposition of new U.S. tariffs on steel and aluminum, adversely affected Indonesian exports. These tariffs not only impacted direct exports but also led to an influx of redirected goods from other markets, intensifying competition for local industries such as textiles and rubber.

Domestically, the establishment of the Danantara Indonesia sovereign wealth fund aimed to consolidate state-owned enterprises and stimulate economic growth. However, concerns over transparency and potential political interference within Danantara led to investor skepticism, contributing to market sell-offs. Additionally, rumors surrounding the potential resignation of Finance Minister Sri Mulyani Indrawati further unsettled markets. Although she publicly denied these speculations and reaffirmed her commitment to fiscal discipline, the uncertainty added to investor unease. Regarding the “Undang-Undang TNI” (Indonesian National Armed Forces Law), no significant developments were reported in March 2025 that directly impacted the equity market.

The geopolitical landscape also influenced market dynamics. The Ukraine-Russia and Israel – Palestine ceasefire, while reducing some global uncertainties, had limited direct impact on Indonesian equities. However, it contributed to the broader context of fluctuating commodity prices, affecting sectors reliant on exports.

In summary, March 2025 was marked by a complex interplay of global trade policies, domestic economic initiatives, and political developments, collectively influencing the performance of the Indonesian equity market.