Danantara CIO: US-Iran peace positively impacts Indonesia's economy

Chief Investment Officer (CIO) of the Danantara Investment Management Agency Pandu Sjahrir assessed that a peace agreement between the United States and Iran would have a positive impact on Indonesia’s fiscal stability and economic growth. “If our reading is correct, if this has indeed found peace, it is actually good. Looking at oil prices, we expect better economic stability,” Pandu said at the Presidential Palace complex in Jakarta on Thursday evening. According to Pandu, the certainty of peace in the Middle East region will greatly influence the movement of global commodity prices, especially world crude oil. If oil price stability can be maintained, it is believed to strengthen the state budget posture. He further explained that the positive impact of easing global geopolitical tensions does not stop at the energy sector but also spills over into the broader macroeconomic sector. This is expected to provide safer manoeuvring space for the domestic market. Besides highlighting global geopolitical issues, Pandu also responded to domestic monetary policy dynamics regarding Bank Indonesia’s decision to raise the benchmark interest rate on the same day, namely by 25 basis points (bps) to 5.75 percent. He stated that Danantara will continue to follow the regulations set by the relevant authorities. Pandu emphasised that as an investment management institution, Danantara is ready to support every step taken by policymakers to maintain national economic resilience. The agency believes the decision has undergone careful calculation from both the fiscal and monetary sides. “Of course, we definitely support it; they have already calculated it. For us at Danantara as practitioners, we will do our best,” said Pandu.