S&P Global Ratings has flagged rising fiscal pressures as a growing threat to Indonesia's sovereign credit rating, warning that higher debt-servicing costs could trigger negative rating action. The warning comes just weeks after Moody's Investors Service issued similar concerns about the Southeast Asian nation's fiscal trajectory.

The ratings agency highlighted that Indonesia's debt-servicing burden is becoming increasingly unsustainable, creating downside risks for the country's credit profile. This follows years of pandemic-related stimulus spending that pushed government debt levels higher, with interest payments consuming an ever-larger share of the budget.

Indonesia's government has been working to contain fiscal pressures through revenue reforms and spending controls, but the combination of rising global interest rates and persistent budget deficits continues to challenge the nation's fiscal stability. The dual warnings from major ratings agencies underscore mounting concerns about Indonesia's ability to manage its debt burden in an environment of higher borrowing costs.