Reviewed by Gotrade Internal Analyst
Gotrade News - Indonesia Stock Exchange (IDX) President Director Iman Rachman officially resigned on Friday (Jan 30). This move was taken as a direct form of accountability for the market turbulence witnessed over the last two days.
The resignation comes right in the middle of severe pressure crushing domestic stock indices. Investors need to pay close attention to this leadership transition as it is directly tied to efforts to restore faith in the capital market.
Key Takeaways
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Iman Rachman quits in response to a sharp market correction and transparency warnings from MSCI.
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The risk of a downgrade to "frontier market" status has triggered significant foreign capital outflows.
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Regulators are tightening free float rules as a quick fix to calm global investor nerves.
This decision links back to a red flag raised by global index provider MSCI regarding a potential downgrade of Indonesia's market status. According to a CNA report, this warning triggered a massive sell-off that wiped out roughly US$80 billion in market value.
MSCI highlighted issues with ownership and trading transparency that require immediate fixing. If not resolved by March, the Indonesian market risks being downgraded to "frontier market" status, which implies lower liquidity.
Fiscal Policy Jitters
Foreign capital is heading for the exit door due to concerns over the widening fiscal deficit under the new administration. CNA notes that the replacement of Finance Minister Sri Mulyani has also shaken global investor confidence in the country's budget management.
This negative sentiment hit the Rupiah hard against the US Dollar in the spot market. The currency dipped to a record low of 16,985 before clawing back slightly to close at 16,800.
The mix of political uncertainty and the MSCI warning created the worst selling pressure seen since April. Exchange data shows foreign investors dumped a net US$645 million worth of Indonesia stocks in just two days.
Regulator Response and Market Direction
Market authorities are now moving fast, doubling the free float requirement for listed companies to 15%. This step aims to cool down investor anxiety and meet the transparency standards demanded by MSCI.
The IDX confirmed that operations will run as usual with an Acting Director (Plt) set to be appointed soon. Iman Rachman emphasized that the succession mechanism will strictly follow the company's Articles of Association.
These regulatory fixes are seen as crucial to stop a bigger, systemic bleeding of funds. The government has a strong incentive to squash these structural bugs immediately to maintain market stability.
Market players are now in "wait and see" mode, looking for the realization of these governance promises. Market stability in the coming weeks will hang heavily on the follow-up response to MSCI's evaluation.
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Reference:
CNBC, Breaking: Dirut Bursa Efek Indonesia Iman Rachman Mengundurkan Diri. Accessed on January 30, 2026
CNA, Indonesia stock exchange CEO resigns after US$80 billion market rout. Accessed on January 30, 2026
Bloomberg, Indonesia Stock Exchange CEO Resigns After Market Rout. Accessed on January 30, 2026
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