August 20, 2025 | 07:45 pm
TEMPO.CO, Jakarta - The Indonesia Composite Index (IHSG) of the Indonesia Stock Exchange (IDX) on Wednesday afternoon, August 20, 2025, closed higher as market players responded positively to Bank Indonesia's (BI) reduction of its benchmark interest rate.
The IHSG closed up by 80.87 points or 1.03 percent to 7,943.82. Meanwhile, the group of 45 leading stocks (LQ45) index rose by 11.72 points or 1.44 percent to 826.95.
"The strengthening of the IHSG seems to be supported by foreign investors starting to accumulate again," said the Pilarmas Investindo Sekuritas Research Team in their analysis in Jakarta on Wednesday.
From within the country, the August 2025 Board of Governors Meeting (RDG) of Bank Indonesia (BI) decided to cut the BI Rate by 25 basis points to 5 percent, in line with the low inflation forecasts for 2025 and 2026, maintaining the stability of the rupiah exchange rate, and the need to boost economic growth.
"In the future, Bank Indonesia will continue to monitor the room for easing interest rates to drive higher economic growth, in line with low inflation forecasts, while maintaining the stability of the rupiah exchange rate," said BI Governor Perry Warjiyo.
Internationally, market players are taking a "wait and see" approach ahead of Federal Reserve Chair Jerome Powell's speech at the Jackson Hole Symposium on Friday, August 22, 2025, which will serve as a reference for the Fed's monetary policy direction at the September 2025 meeting.
On the other hand, negotiations between the United States and China are going well. U.S. Treasury Secretary Steve Mnuchin stated that the U.S. has had very good discussions with China regarding tariffs, as both countries seek a trade deal during the 90-day tariff truce.
In the Asian region, market players are responding to the People's Bank of China's (PBOC) monetary policy. The PBOC has maintained its main loan interest rates, including the one-year Loan Prime Rate (LPR), at 3.0 percent. Meanwhile, the five-year LPR has remained steady at 3.5 percent.
Opening higher, the IHSG remained in positive territory until the close of the first stock trading session. In the second session, the IHSG still lingered in the green zone until the close of stock trading.
According to the IDX-IC Sectoral Index, the property sector led the ten sectors that strengthened, rising by 1.68 percent. The raw material and primary consumer goods sectors followed, increasing by 1.60 and 1.55 percent, respectively.
Meanwhile, one sector corrected, namely the health sector, which fell by 0.10 percent.
The frequency of stock trading was recorded at 2,328,397 transactions with a total of 40.82 billion shares traded worth Rp20.05 trillion. A total of 428 stocks rose, 230 stocks fell, and 148 remained unchanged.
Regional stock exchanges in Asia this afternoon included the Nikkei Index falling by 616.29 points or 1.42 percent to 42,930.00, the Hang Seng Index rising by 43.04 points or 0.17 percent to 25,165.94, the Shanghai Index increasing by 38.92 points or 1.04 percent to 3,766.21, and the Strait Times Index strengthening by 0.50 points or 0.01 percent to 4,216.97.
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