JPM EM Corporate Strategy Daily

Research evidence excerpt

JPM EM Corporate Strategy Daily

J P M O R G A N Global Credit Research

16 July 2026

Emerging Markets Corporate

Strategy

Yang-Myung Hong AC

(1-212) 834-4274

ym.hong@jpmorgan.com

J.P. Morgan Securities LLC

Our Asia team continues to believe in the Indonesia story, even though there

Alisa Meyers

are still many challenges. Fiscal policy is still disciplined yet more constrained,

(1-212) 834-9151

the rupiah is being driven more by sentiment and flows than by fundamentals, and alisa.meyers@jpmorgan.com

policy rollout/communication remains the key investor overhang. At the same J.P. Morgan Securities LLC

time, they think the government has shown it will course-correct when markets Dhawal U Mehta

react badly, but such market volatility also creates opportunities for investors. They (91-22) 6157 3779

find valuations for Indonesian quasi-sovereigns and IG Corporates continue to dhawal.mehta@jpmchase.com

look attractive versus peers, and remain constructive here. They stay OW on PLN, J.P. Morgan India Private Limited

Pertamina, MIND ID and Freeport Indonesia. Please see here for more

information.

CEMBI Indonesia spread compressed meaningfully against CEMBI BD from

2023, but has lagged coming into 2026. The basis over CEMBI BD used to be

50bp to 100bp until 2022, and outperformed during 2023 to push the basis to as

much as -35bp. However, after bottoming at 143bp in late January this year,

CEMBI Indonesia started to widen and is now at 176bp which is +18bp YTD

versus -15bp for CEMBI BD and -3bp for CEMBI BD Asia. As a result, the YTD

return of +0.7% is one of the lowest among the major country segments, lagging

both CEMBI BD (+2.1%) and CEMBI BD Asia (+1.5%). We have had Indonesia

on neutral in our CEMBI segment recommendation, with most of our Asia team’s