Indonesia issues US$1 billion Panda Bond to curb dollar dominance
The yuan-denominated bond received an AAA/Stable rating in China, while the book-building results have not yet been disclosed.
The government issued about US$1 billion in Panda Bond in the China market on July 23, 2026, as part of efforts to diversify funding and reduce reliance on the U.S. dollar. Finance Minister Purbaya Yudhi Sadewa said the yuan-denominated instrument was also designed to support the local currency transaction scheme so more trade with China uses yuan and rupiah. He said the move could ease pressure on dollar demand and help maintain the rupiah's exchange rate. Proceeds from the issuance will be used to cover part of the government's deficit financing needs and spending. Separately, the Panda Bond received an AAA rating with a stable outlook from Lianhe Rating Co., Ltd. on July 1, 2026, although the government has not disclosed the final book-building results.