JCI Falls as Investors Await US Fed Rate Decision
Indonesia's JCI opened lower as investors took a wait-and-see stance ahead of the US Fed's interest rate decision amid persistent inflation concerns.
The Jakarta Composite Index (JCI) of the Indonesia Stock Exchange (IDX) fell on Monday morning as traders remained undecided on the US Federal Reserve's upcoming interest rate decision. The JCI opened 7.51 points or 0.11 percent lower at 6,533.87. The LQ45 index, comprising 45 blue-chip stocks, dropped 0.74 points or 0.11 percent, settling at 648.98.
To maintain its current level, the JCI must stay above 6,530, with a potential decline towards 6,425 if it fails to hold. If the index rebounds above 6,592, it could test the 6,723 resistance level before reaching the next target of 6,859. Liza Camelia Suryanata, Head of Research at Kiwoom Sekuritas Indonesia, explains that global focus is on the US Federal Reserve's FOMC meeting on September 15-16, 2026.
Market participants expect the Fed to raise benchmark rates as US inflation remains high, with headline inflation at 3.4 percent in August 2026 and rising consumer inflation expectations. Inflation concerns, coupled with a decline in the University of Michigan's Consumer Sentiment Index to 47.8 in September 2026, are weighing on market sentiment.
Additionally, geopolitical tensions between the US and Iran have added uncertainty to energy trade routes in the Persian Gulf. On the domestic front, tax revenue is expected to reach Rp1,409.1 trillion by August 2026, but a tax revenue shortfall of Rp80-140 trillion could strain business cash flows and hinder economic growth. Business expectations for the third quarter of 2026 have also turned more pessimistic due to potential rupiah depreciation, rising inflation, and El Niño risks to food prices.
Written by urgent.news from Tempo.co English's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
