Moody's Ratings remains concerned about policy uncertainty and fiscal sustainability risks in Indonesia, reinforcing its cautious outlook and warning that downside risks are likely to persist. The rating agency highlighted that unpredictable policy shifts could undermine investor confidence and complicate fiscal planning, particularly as the government navigates revenue collection challenges and spending pressures.

Analysts at Moody's noted that while Indonesia's economic fundamentals remain relatively resilient, the lack of policy clarity creates headwinds for creditworthiness. The agency emphasized that sustained uncertainty could delay structural reforms needed to strengthen the sovereign's fiscal position over the medium term.

The cautious stance reflects broader concerns about emerging markets where policy volatility has increased. Moody's signaled that any further deterioration in policy coherence or fiscal discipline could trigger negative rating actions, though the current baseline assumes gradual improvement.

Investors are advised to monitor upcoming budget announcements and regulatory developments for signals of policy direction. The outlook remains contingent on the government's ability to articulate and implement a consistent reform agenda.