March 16, 2026 | 01:56 pm
TEMPO.CO, Jakarta - Equity analyst from PT Indo Premier Sekuritas (IPOT) Hari Rachmansyah predicts that the dynamics of fiscal and monetary policy amid rising global energy commodity prices will influence domestic capital market sentiment this week. He stated that the surge in oil and coal prices could increase pressure on the government's fiscal situation, necessitating quick action to keep the budget deficit under control.
"The combination of fiscal dynamics and the direction of monetary policy is expected to be the main factor shaping the sentiment and movement of the Jakarta Composite Index (JCI) in the short term," Hari said in a press release on Monday, March 16, 2026.
He noted that if the fiscal deficit continues to widen, it could lead to increased government debt financing needs, pressure on government bond yields, and potential exchange rate depreciation due to heightened investor concerns about fiscal stability.
Additionally, Hari believes that market players will also pay attention to the results of the Bank Indonesia Board of Governors Meeting. He believes a consensus that the central bank should maintain the benchmark interest rate in order to preserve exchange rate stability and control inflation amid increasing external pressures.
From an external perspective, Hari perceives that global uncertainty due to geopolitical tensions between the United States and Iran will continue to loom over the market. "As long as the conflict persists, global market volatility is expected to remain high as investors tend to adopt a risk-off stance," he explained.
Hari also predicts that the JCI will fluctuate with a tendency to weaken. Due to the long holiday of Nyepi and Eid al-Fitr, trading this week will only take place on two exchange days: March 16 and 17, 2026.
In an uncertain market, Hari advises investors to be selective when choosing stocks and to prioritize issuers with strong fundamentals, stable cash flows, and relatively defensive exposure to global volatility. "The smart money wait-and-see strategy, maintaining a higher cash portion, and gradual accumulation in the support area can be a more prudent approach while waiting for the clarity of global geopolitical developments and domestic fiscal policy direction," he added.
Read: What Are the Risks of a Widening State Budget Deficit?
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