Reuters: US Dollar Report: Fitch Rates Indonesia's Bond 'BBB-(EXP)'

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Fitch Rates Indonesia's Bond 'BBB-(EXP)' Apr 8th 2013, 05:50 Mon Apr 8, 2013 1:50am EDT HONG KONG, April 08 (Fitch) Fitch Ratings has assigned Indonesia's upcoming USD-denominated global bonds an expected 'BBB-(EXP)' rating. The final rating is contingent on the receipt of final documentation conforming to information already received. Key Rating Drivers The rating is in line with Indonesia's Long-Term Foreign Currency Issuer Default Rating (IDR) of 'BBB-'. The sovereign's Long-Term Local Currency IDR is also 'BBB-'. The rating Outlooks are Stable. The ratings reflect Fitch's view that strong and resilient economic growth, high investment rate, low and declining public debt ratios, and a broadly appropriate overall macro policy framework support Indonesia's credit profile. Pressures on the external finances, a credit weakness, have resulted in some strain on the credit profile, but these are not inconsistent with a 'BBB-' rating. Rating Sensitivities Fitch believes progress in tackling structural weaknesses combined with sustained economic growth, without a build-up of external imbalances or a severe inflation shock, would enhance Indonesia's economic and sovereign credit fundamentals and exert upward pressure on the rating over the medium-term. Reform of public finances, leading to enhanced budgetary flexibility, would also be positive for the ratings. A sustained shock to foreign and domestic investor confidence, leading to heavy capital outflows and a material weakening of the external finances would be negative for the ratings. Deterioration in the quality of fiscal or monetary policy management, leading to signs of overheating such as a pick-up in inflation or widening of external imbalances, would adversely affect the ratings. Instability in the banking system would also be negative for the ratings. Contact: Primary Analyst Anna Thung Associate Director +852 2263 9921 Fitch Ratings 2801, Tower Two, Lippo Centre 89 Queensway, Hong Kong Secondary Analyst Andrew Colquhoun Senior Director +862 2263 9938 Committee Chairperson Paul Rawkins Senior Director +44 20 3530 1046 Media Relations: Leslie Tan, Singapore, Tel: +65 67 96 7234, Email: leslie.tan@fitchratings.com. Additional information is available at www.fitchratings.com. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings. Applicable criteria, 'Sovereign Rating Criteria', dated 13 August 2012, are available on www.fitchratings.com. Applicable Criteria andALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE. Link this Share this Digg this Email Reprints

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