Indonesian Yield Curve Steepest Since Early 2023 on Fiscal Fears

The yield curve in Indonesia is currently experiencing its steepest slope since early 2023, indicating growing unease regarding the country’s fiscal health. The widening gap between short- and long-term bond yields reflects ongoing worries about Indonesia’s financial outlook. Last week, the spread between two- and 10-year bond yields reached approximately 114 basis points, the largest margin seen in recent times. This significant increase underscores the prevailing fiscal fears among investors and analysts alike.