Indonesia’s Surge in COVID-19 Cases to Hamper Fiscal Plans and Credit Ratings: Moody’s

Indonesia is currently facing one of the worst COVID-19 outbreaks, with the more severe Delta variant causing new infections to surpass 50,000 daily with 1,000 daily deaths over the past few days. The Government of Indonesia has extended ongoing movement restrictions to the 25th of July 2021 (these restrictions which started on the 3rd of July 2021, were initially set to end on the 20th of July 2021). Moody’s currently rates Indonesia’s debt at Baa2 (which is only one notch higher than its lowest investment grade rating) and maintains a Stable Outlook.

Why it Matters?

Moody’s Investors Service (Moody’s) predicts that the Government will face challenges in lowering its fiscal deficit to pre-pandemic levels (credit negative), in...