Jakarta, CNBC Indonesia \u2014 The Indonesia Stock Exchange (BEI) does not\ndeny the potential for Morgan Stanley Capital International (MSCI) to\nreduce Indonesia\u2019s index weighting from emerging market to frontier\nmarket status.<\/p>\n
BEI\u2019s acting CEO Jeffrey Hendrik stated that this potential\nrealistically exists in the short term. According to him, several\nfactors could prompt the global index provider to lower Indonesia\u2019s\nweighting, despite ongoing improvements in transparency and\ngovernance.<\/p>\n
\u201cFor example, one or two issues that might lead the global index\nprovider to reduce the weighting in the short term. Yes, that potential\nexists. However, we are also very aware that what we have been doing to\naddress the concerns of global index providers is for the long-term\nbenefit of our capital market industry,\u201d Jeffrey explained to reporters\nat the BEI building on Monday (6\/4\/2026).<\/p>\n
With enhancements in transparency, market depth, and better\ngovernance, BEI believes Indonesia\u2019s weighting will ultimately increase\nin the future. Jeffrey also acknowledged that this transitional phase\ncould cause short-term market pressures.<\/p>\n
On the other hand, domestic investors are said to be able to\ncapitalise on this situation as an investment opportunity. He emphasised\nthat investing in the capital market is fundamentally long-term, so\nshort-term declines can serve as an entry point into the market.<\/p>\n
\u201cCertainly, domestic investors can use this moment as an opportunity.\nYes, the essence of investing in the capital market is long-term\ninvestment. If we believe that the long-term potential is very good,\nthen a short-term decline is certainly an opportunity,\u201d he advised.<\/p>\n
Previously, the Executive Head of Capital Market, Derivatives\nFinance, and Carbon Exchange Supervision at the Financial Services\nAuthority (OJK), Hasan Fawzi, stated that OJK and BEI are preparing risk\nmitigation measures if the Composite Stock Price Index (IHSG) falls due\nto MSCI.<\/p>\n
Hasan urged investors not to react reactively if a reduction in index\nweighting occurs. He admitted that the ongoing capital market reforms\nwill have short-term impacts.<\/p>\n
\u201cThis might involve portfolio adjustments by domestic or global\ninvestors, which could trigger temporary selling pressure, as well as\npotential outflows during rebalancing, followed by volatility and\nwidening bid-ask spreads on certain stocks,\u201d Hasan said during a virtual\npress conference on Monday (6\/4\/2026).<\/p>\n
However, Hasan noted that these dynamics are transitional and\ntemporary responses. They are part of unavoidable progress. The primary\nfocus of capital market regulators is to build a foundation of market\nintegrity that is transparent, credible, and consistently growing.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/msci-could-lower-indonesias-weighting-stock-exchange-boss-says-this-1775627479", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }