Bond Stabilisation Fund (BSF) Seen as a Buffer for Market Confidence

JAKARTA, KOMPAS.com - The Bond Stabilisation Fund (BSF) is seen as capable of serving as a buffer for bond market stability, particularly to prevent yield spikes resulting from short-term panic.

Economist from Andalas University, Syafruddin Karimi, stated that the BSF is effective when market pressures stem from technical selling actions, liquidity dryness, or short-term portfolio panic.

“The BSF can act as a supporting buyer when SBN prices fall, thereby preventing yields from surging wildly,” Syafruddin told Kompas.com on Friday (8/5/2026).

The yield on 10-year Government Securities (SBN) was recorded as stable at 6.701 per cent. Meanwhile, the three-year tenor yield dipped slightly to 6.542 per cent, and the five-year tenor rose slightly to 6.781 per cent.

At the same time, Indonesia’s credit default swap (CDS) also experienced declines across various tenors.

The five-year CDS fell to 2.978 basis points, while the 10-year CDS dropped to 2.344 basis points.

According to Syafruddin, this condition indicates that the market does not yet view Indonesia’s credit risk as deteriorating significantly.

Therefore, the presence of the BSF is considered to have the potential to increase investor sense of security as long as the government can clearly explain the function of this instrument.

“Investors will have greater confidence if the BSF has a clear mandate: maintaining SBN liquidity, preventing price dislocations, and stemming capital outflows triggered by capital losses,” he said.

Investors will still monitor the direction of the rupiah, inflation, fiscal conditions, and developments in global interest rates.