Purbaya Explains Funding Sources for Bond Stabilization Fund
Finance Minister Purbaya Yudhi Sadewa has explained the funding sources for the Bond Stabilization Fund (BSF) that the ministry plans to launch. He stated that the funds for the BSF will not only come from the Budget Surplus Balance (SAL).
“If it’s a proper fund, the old design involves several institutions, including the Ministry of Finance and all special mission vehicles (SMVs) under the Ministry of Finance, which can assist when we stabilise bond prices,” Purbaya said during a press conference of the Financial System Stability Committee in Jakarta on Thursday, 7 May 2026.
The State Treasurer explained that the Bond Stabilization Fund initiative fundamentally aims to maintain the prices of Government Securities (SBN) amid capital outflows from foreign investors in the domestic market. According to Purbaya, although the foreign capital exiting the SBN market is not substantial, it disrupts the rupiah’s exchange rate stability.
Year-to-date, Bank Indonesia recorded capital outflows from the SBN market reaching Rp11.7 trillion. Meanwhile, based on Trading Economics data, Indonesia’s 10-year bond yield fell to 6.70 percent on 6 May 2026, after previously reaching 6.96 percent in April 2026.
Purbaya stated that the Bond Stabilization Fund mechanism is still under discussion and refinement, including if the funds are used for buybacks or repurchasing SBN. He also mentioned that the BSF initiative will be coordinated with Bank Indonesia.
Nevertheless, the former Chairman of the Deposit Insurance Corporation’s Board of Commissioners claimed that the financial system’s stability is currently maintained. “The urgency (of the BSF) is just that: to keep our bond prices stable so as not to cause unrest in the capital market,” Purbaya said.
The Bond Stabilization Fund initiated by Purbaya differs from the Bond Stabilization Framework, which has been launched through protocols of the Financial System Stability Committee. The Bond Stabilization Framework is one of the government’s mitigation measures, consisting of a short- and medium-term framework to anticipate crisis impacts in the domestic SBN market.
The Bond Stabilization Framework initiative was previously explained by Sri Mulyani in 2018 when she was still Finance Minister. At that time, Sri stated that the BSF could be activated if the Financial System Stability Committee (KSSK) deemed the economic conditions to be on alert.