Jakarta. Indonesia’s financial markets faced turbulence last week as President Prabowo Subianto’s decision to reshuffle his cabinet -- including replacing the finance minister -- triggered a wave of foreign capital outflows worth Rp 14.24 trillion ($869 million) in just three days.

Data from Bank Indonesia showed the largest withdrawals occurred in the central bank’s rupiah securities (SRBI) at Rp 6.57 trillion, followed by Rp 5.45 trillion from government bonds (SBN) and Rp 2.22 trillion from equities. Analysts say the sudden pullback underscores rising investor unease over policy continuity.

Yusuf Rendy Manilet, a researcher at the Center of Reform on Economics (Core) Indonesia, noted that the timing of the selloff, coinciding with the cabinet changes, highlighted strong domestic factors. He explained that SRBI is usually considered relatively safe and rarely sees such withdrawals. "This indicates that some investors are questioning fiscal and monetary coordination amid the reshuffle,” he said, as quoted by Investor Daily newspaper on Monday.

According to Yusuf, the appointment of a new finance minister has become the central concern. “Leadership transitions can be perceived as potential shifts in policy direction, whether on fiscal discipline or economic priorities, leading to doubts among investors,” he explained. “This is more of an early warning than an economic shock.”

On September 8, President Prabowo appointed Purbaya Yudhi Sadewa as finance minister, replacing Sri Mulyani Indrawati. He also introduced a new Ministry of Hajj and Umrah, replaced the ministers for cooperatives and migrant worker protection, and removed Youth and Sports Minister Dito Ariotedjo and Coordinating Minister for Political and Security Affairs Budi Gunawan, though their successors have yet to be named.

Yusuf stressed that in emerging economies, changes in the finance ministry are closely watched, as the role is pivotal for macroeconomic stability. The rapid market reaction -- capital outflows and a weakening rupiah -- reflects uncertainty over fiscal policy direction rather than external factors.

Bank Indonesia reported that between January 1 and September 11, 2025, net sales reached Rp 54.33 trillion in equities and Rp 117.72 trillion in SRBI, offset by Rp 58.94 trillion in net purchases of government bonds.

Temporary Reaction or Trend?
Business leaders believe the recent selloff may prove temporary if the government communicates its policies effectively. Anggawira, Secretary General of the Indonesian Young Entrepreneurs Association (Hipmi), described the September 8–11 outflow as partly a response to both the reshuffle and U.S. dollar strength.

“The one-to-three-week window after a cabinet reshuffle is crucial for stabilizing sentiment,” he said, emphasizing that the finance minister’s role is particularly influential in shaping market expectations.

“In the immediate aftermath of the reshuffle, we saw the stock index weaken and the rupiah fluctuate,” Anggawira noted. “Whether this continues depends on how clearly the government signals its policy direction.”