Jakarta. A global sell-off hit Indonesian stocks on Friday as stronger bets on a US rate hike and rising inflation concerns pushed the Jakarta Composite Index down 0.55% to 6,552 at the open.

About 1.8 billion shares changed hands in the early session, with total transactions reaching Rp 833.93 billion ($47.38 million) across 112,419 trades. A total of 105 stocks advanced, 381 declined and 175 were unchanged.

Asian markets also fell as of 9:15 a.m. Jakarta time, with Japan’s Nikkei down 2.92%, South Korea’s Kospi 2.48%, Hong Kong’s Hang Seng 1.07% and Shanghai’s SSE 1.48%.

Phintraco Sekuritas said Indonesia’s retail sales grew 1.1% year-on-year in July 2026 after three consecutive months of contraction, supported by stronger food, beverage and tobacco as well as clothing sales. However, weaker spending on fuel, communication equipment and recreational products suggested consumers remained focused on essential goods.

The firm also said the state budget deficit reached Rp 235.6 trillion, or 0.91% of GDP, by July, while state spending rose 18.62% year-on-year to Rp 1,969 trillion.

“However, if oil prices remain high for an extended period and the government does not manage the budget efficiently, concerns could grow over a potential widening of the state budget deficit,” Phintraco said.

Kiwoom Sekuritas Indonesia said the government could use state budget reserves to support a plan to open bank accounts for up to 200 million people starting in 2027. Finance Minister Purbaya Yudhi Sadewa estimated the program could require less than Rp 11 trillion.

“This program could potentially expand financial inclusion, though its impact on the state budget will depend on the number of accounts realized and the government’s assignment mechanism,” Kiwoom said.

Globally, Kiwoom said investors were shifting their focus from corporate earnings to inflation, interest rates and energy prices. The probability of a 25-basis-point Fed rate hike at the September 16 FOMC meeting rose to around 73% from 64% before the PPI release, based on CME FedWatch.

Pluang Research said higher US Treasury yields and oil prices were adding pressure to bond markets, while concerns over rising government debt supply posed longer-term risks. “We maintain our 12-month targets of $5,200 per troy ounce for gold and $100,000 for Bitcoin, as the combination of geopolitical and fiscal risks strengthens the case for diversification into assets outside the US dollar,” Pluang Research said through their report on Friday.

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