Indonesia’s sovereign ratings lifted

jakarta — Ratings agency Standard & Poor’s upgraded Indonesia’s sovereign ratings to investment grade on Friday, a long-awaited move that sent Jakarta shares soaring on hopes it could spur a wave of investment into Southeast Asia’s biggest economy.

Fund managers say the investment grade from S&P, which matches the ratings awarded by Fitch and Moody’s years ago, will give Indonesia access to a wider pool of investors. A rating upgrade usually also means an economy can get cheaper borrowing costs when it issues bonds.

S&P upgraded Indonesia’s sovereign credit outlook to BBB, its lowest investment grade, up from the previous junk status of BB+. The agency gave the new rating a stable outlook.

“It’s about time,” Wellian Wiranto, an economist at OCBC Singapore wrote in a report on the upgrade headlined Better late than never.

Fitch upgraded Indonesia to investment grade in December 2011 and Moody’s in January 2012. —