Ministry of Finance of Indonesia has activated the Bond Stabilization Fund (BSF) as part of efforts to help stabilize the rupiah exchange rate against the US dollar.

The BSF is an emergency instrument designed to ease pressure in the bond market while supporting rupiah stability. This intervention is carried out in the bond market to maintain competitive yield levels. The government seeks to preserve yields by purchasing government bonds or sovereign debt securities being sold by foreign investors.

Finance Minister Purbaya Yudhi Sadewa revealed that the government has prepared an allocation of Rp2 trillion per day to implement the scheme.

“I requested that Rp2 trillion be injected every day,” Purbaya stated at the Presidential Palace Complex on Monday (18/5/2026).

Purbaya explained that the state budget still has sufficient room for cash management measures, allowing the government to allocate funds for the program. He also emphasized that the funds invested by the government would not incur losses.

“The money is not disappearing; it is simply being rotated to create positive sentiment in the bond market,” he said.

So, where does the Rp2 trillion daily allocation come from?

Purbaya explained that the funds injected into the bond market originate from government cash management, including the Budget Surplus Balance (SAL), which currently amounts to Rp420 trillion.

“We still have several funding sources. This is merely part of cash management, so there is no issue,” Purbaya said.

He further explained that if positive sentiment emerges in the bond market, foreign investors would likely return, helping to stabilize the rupiah because capital outflows could be reduced.

“If foreign investors do not sell bonds and leave the market because bond prices remain stable, the situation will improve. When yields decline, bond prices rise, creating the potential for capital gains. That should make our bond market more attractive,” Purbaya explained.