Indonesia’s central bank raised the volume of its short‑term bills last month, marking the steepest increase in almost two years. The move aims to lure foreign capital as the nation grapples with a slipping rupiah, putting pressure on monetary policy tools and heightened inflation concerns.

By issuing more bills, the bank hopes to widen the yield curve and make Indonesian assets more attractive to investors seeking higher returns. Capital inflows could bolster foreign exchange reserves, easing the currency’s depreciation and supporting the government’s broader economic stabilization agenda in the short term.

The policy shift arrives amid a broader regional trend where central banks tap short‑term instruments to manage volatile capital flows. Analysts note that while higher bill issuance can absorb excess liquidity, it also raises the cost of borrowing for domestic firms, potentially dampening credit growth.

Investors will watch how the added supply interacts with the Indonesia central bank’s rate path and any further moves to defend the rupiah. Immediate market reaction showed modest yield tightening, suggesting the strategy is already influencing pricing without triggering abrupt volatility in the bond market.