UOB Singapore analysts Kay Hian and Suryaputra Wijaksana believe that Indonesia's short-term economic outlook may weaken as Moody's has downgraded the country's credit rating outlook from "stable" to "negative".

Analysts pointed out that the Indonesian rupiah is the most affected and may weaken. Increased volatility in the rupiah will dampen foreign investment, impacting both long-term foreign direct investment and short-term portfolio inflows, especially in the bond market. The downgrade in rating outlook will also lead to a repricing of risk premiums in the bond market. Analysts stated: "Investors will demand higher yields to compensate for the expected increase in credit risk."