Bank Indonesia (BI) cut its benchmark interest rate for the fifth time this year, lowering it to 4.75 percent just a day before the United States Federal Reserve (the Fed) announcement. The move reflected BI’s bet that the US monetary authority would also ease its policy. A day later, the Fed indeed cut the federal funds rate (FFR) for the first time in 2025. Both central banks’ decisions were driven by concerns over slowing economic growth but also sparking debate on government influence in central bank decisions.

When President Prabowo Subianto deployed the Indonesian Military (TNI) to the streets to restore order during last month’s nationwide protests, it was merely the latest example of a pattern the country has witnessed since he took office in October last year.

The surprise appointment of Deputy Finance Minister Anggito Abimanyu as chairman of the Deposit Insurance Corporation (LPS) marks a clear break from established selection procedures and casts uncertainty over President Prabowo Subianto’s plan to create a separate revenue collection agency.

The House of Representatives has added 52 draft bills to the second amendment of the 2025 National Legislation Program (Prolegnas), an increase from the initial 41. Meanwhile, the number of bills prioritized for 2026 stands at 67. Beyond this matter of quantity, the House must place greater emphasis on the quality of legislation, ensuring that laws reflect the interests of the people rather than serving only a few elites within the ruling coalition.

The government is accelerating funding mechanisms to secure Indonesia’s food, energy and water needs, but the latest regulatory changes raise concerns about oversight and potential misuse. On Sept. 22, the Government Procurement Agency (LKPP) issued Regulation No. 3/2025 on Guidelines for Procurement of Goods from Completed Works in the Development of Self-Sufficiency Areas. Under the new regulation, vendors are no longer required to undergo electronic bidding or conduct feasibility studies, a change that enables faster disbursement of funds but increases the risk of inefficiency and misuse.

In the aftermath of the massive August anti-government riots, President Prabowo Subianto carried out two rounds of Cabinet reshuffles to consolidate power and control over his big-tent coalition government. The turmoil, which he described as bordering on treason, is the most serious challenge to his power since he took office in October last year.

Indonesia's Industry Ministry will phase out incentives for fully built-up (CBU) imports of battery electric vehicles (BEVs) by the end of 2025, shifting the policy focus toward local production starting in 2026. Automakers such as BYD and Geely, which have pledged investments totaling Rp15.52 trillion (US$936.62 million), are required to begin assembling vehicles domestically from that year. Should they fail to meet the production requirements, the government reserves the right to claim their bank guarantees in line with the local content requirement (LCR) roadmap and investment regulations.