Indonesia's 10-year government bond yield is at a 4-year high

Indonesia's 10-year government bond yield rose three basis points on Tuesday to 7.52 percent, the highest recorded since November 2022.

Thus, the increase since the beginning of the year exceeded 140 basis points.

This rate was one of the largest increases among developing Asian countries.

The Indonesian rupee is just 0.2 percent away from its all-time low.

The benchmark stock market index suffered the steepest loss of the last week, with a decrease of up to 2.7 percent.

"The direct impact of MSCI's warning on bond yields is expected to remain minimal, but risks may arise if foreign outflows from equity markets continue and this puts pressure on the rupee," said Handy Yunianto, head of fixed income securities research at PT Mandiri Sekuritas.

The expert added that the 10-year bond yield is approaching the fair value range between 7.5 percent and 7.7 percent, and that if the risk aversion tendency eases and oil prices fall, the yields may start to decline.