Research
Research reports and notes worth reading, with links to the originals.
BCA economic research
Reports
| Title | Date | Type | Summary |
|---|---|---|---|
| The deep lying playmaker | 24 Sep 2026 | BI policy | 1 • Bank Indonesia (BI) kept the BI Rate unchanged at 5.75% at its Sept-26 meeting, marking the third consecutive meeting of policy rate stability. The decision was notable given that several major central banks, including the Fed, ECB, and BoJ, raised their policy rates in Sept-26. • The increase in foreign capital inflows into SBN (+IDR 7 Tn following the Fed rate hike) and the Rupiah remaining below the psychological level of 17,900–18,000 were key factors behind BI’s decision to keep the BI Rate unchanged. This also reflects BI’s confidence in its hedging incentive policy. |
| A stable boat on a rough sea | 22 Sep 2026 | The Focal Point (weekly) | A couple of significant events mark another hawkish pivot in market expectations in recent weeks. First, the re-intensifying tension between the US and Iran has now spilled over to the wider part of the Middle East, disrupting another important waterway that threaten global oil supply ahead of the winter period. Inflation expectations, in turn, are returning as oil prices attempt to climb back above USD 100/bl (+10.33% MTD), forcing central bankers globally to act on their hawkish talks. ▪ Indeed, most major central banks have opted to raise their policy rates in response to these warfuelled i |
| No way down | 17 Sep 2026 | FOMC | 1 • The Fed hiked its policy rate by 25 bps to 3.75% - 4.00% for the first time since 2023, as widely anticipated by the futures market. The statement highlighted an upbeat economy coupled with elevated inflation. The above $100/bbl oil price, a stable labor market, and market pressure to hike rates (with over a 90% implied probability of a hike) made way for the decision. |
| Racing the frontier | 16 Sep 2026 | The Focal Point (weekly) | The volatility in the US bond market continued to intensify in the past week, with 10-year UST yield had breached the 5% ‘psychological threshold’. Bessent's recent $5.2 billion UST buyback failed to reassure investors, contributing to further selloffs in long-dated bonds. However, the Treasurer seems to remain defiant on this approach, dismissing traders as 'Bloomberg Terminal bros' and rejecting the premise that heightened US risk premia are the primary drivers of rising yields. ▪ To be fair, the (expected) inflation picture does explain some of the rise. |
| Finding a new life jacket | 7 Sep 2026 | FX reserves | 1 ▪ Indonesia's FX reserves have recovered to USD 146.5 Bn in Aug-26 from USD 145.3 Bn in July. The main driver of this increase are the net foreign inflows from all 3 main instruments, as well as higher valuation of gold reserves (USD 1.1 Bn). ▪ The month of August has brought relatively few headwinds. First, Prabowo had appointed longtime BI bureaucrats to helm the Central Bank. |
| Beware of the regressive trait of inflation | 7 Sep 2026 | The Focal Point (weekly) | The global macro focus appears to have once again turned to Japan over the past week. The Fed may explain this still-dynamic development, as recent statements by some FOMC members have pushed the market firmly towards a no-hike outlook for the upcoming FOMC meeting. This policy signal, of course, contrasts with the more hawkish signals from other major central banks (such as the BoJ and ECB), helping to explain the ongoing weakness in the DXY index (-0.93% WoW). ▪ Other currencies, of course, have benefited from the USD’s recent weakness, including the Rupiah. |
| An upcoming test | 2 Sep 2026 | Inflation | 1 • Indonesia’s CPI inflation rose to 3.19% YoY (+0.21% MoM) in Aug-26, compared to 2.88% in Jul-26. The rebound was broadly expected, driven by an increase in food prices, gold prices and lingering transportation costs. • Volatile food remained the primary driver, accelerating to 4.06% YoY (0.88% MoM) in Aug-26. While El Niño conditions have begun to set in, it would be premature to attribute the full effect to the weather as the event has only just started and has yet to reach its peak. • The more immediate cause is the resumption of the school season, which brought with it the return of the |
| Head above water breaths still shallow | 2 Sep 2026 | Trade balance | 1 • Indonesia’s trade balance rebounded to a surplus of USD 0.12 Bn in Jul-26, recovering from a USD 0.45 Bn deficit in the previous month. This reversal was driven by export growth (2.98% MoM) that outpaced a marginal increase in imports (0.72% MoM). • The export recovery was primarily supported by non-O&G demand (4.25% MoM), particularly in iron and steel (18.27% MoM), electrical machinery (15.97% MoM), and chemical products (13.38% MoM). Conversely, three main categories acted as drags on overall export performance. |
| Robust yet cautious | 1 Sep 2026 | The Focal Point (weekly) | |
| Tighten the belt loosen the shirt | 27 Aug 2026 | The Focal Point (weekly) | |
| A pyrrhic surplus | 21 Aug 2026 | Balance of payments | |
| Dig before thirsty | 19 Aug 2026 | BI policy | |
| Leak plugging and optimising | 18 Aug 2026 | The Focal Point (weekly) | |
| Finding room to breathe | 11 Aug 2026 | The Focal Point (weekly) | |
| Scalpels over knives | 7 Aug 2026 | FX reserves | |
| Great liquidity great responsibility | 5 Aug 2026 | GDP | |
| Swinging through a narrowing path | 4 Aug 2026 | The Focal Point (weekly) | |
| Relief over the summer | 3 Aug 2026 | Inflation | |
| A brand new day for exports | 3 Aug 2026 | Trade balance | |
| Not much defence against the inflation horde | 27 Jul 2026 | The Focal Point (weekly) | |
| Bis odyssean maneuver | 23 Jul 2026 | BI policy | |
| Borrowing momentum | 21 Jul 2026 | The Focal Point (weekly) | |
| One seller among many | 15 Jul 2026 | The Focal Point (weekly) | |
| The cost of calm | 8 Jul 2026 | FX reserves |
Source: BCA Laporan Riset Ekonomi (bca.co.id)
Data ↓Central-bank and research notes
Latest notes
| Title | Date | Source | Summary |
|---|---|---|---|
| Who’s Borrowing and Lending in Repo Markets? | 28 Sep 2026 | NY Fed Liberty Street | Repo markets play a vital role in the U.S. financial system. In this three-part series, we examine who participates in these markets, what trade-offs influence how different repo segments are structured, and why repos matter for monetary policy. Today's post introduces repo transactions, focusing on |
| FEDS Note: When the Chips Went Down: Motor Vehicle Production and the 2021-2022 Semiconductor Shortages | 28 Sep 2026 | Fed FEDS Notes | Adrian Hamins-Puertolas and Maria D. Tito The motor vehicle industry suffered severe production disruptions during 2021 and 2022, as semiconductor shortages—triggered by pandemic-era plant closures and shifting demand patterns—brought some assembly lines to a standstill. Having recovered to nearly |
| FEDS Note: Beyond Face Value: How Composition Changes Affect Import Unit Values of Light Vehicles | 28 Sep 2026 | Fed FEDS Notes | Robin Braun and Maria D. Tito Light vehicles (NAICS 33611) account for approximately 7 percent of U.S. merchandise goods imports, making it an economically significant trade category. Because motor vehicles also receive a sizable weight in the Bureau of Labor Statistics (BLS) Import Price Index, c |
| Agentic Limit Order Books: Phase Transitions and Market Impact | 28 Sep 2026 | arXiv q-fin | arXiv:2609.31260v1 Announce Type: new Abstract: We investigate the systemic macroscopic dynamics emerging from Limit Order Books (LOBs) populated exclusively by autonomous reinforcement-learning agentic traders. By formalizing agent interactions within a microscopic order-matching engine, we examin |
| Taming the Option Factor Zoo: A High-Dimensional Analysis | 28 Sep 2026 | arXiv q-fin | arXiv:2609.31263v1 Announce Type: new Abstract: Option-implied factors are largely, but not entirely, spanned by the equity factor zoo. We construct 137 option-implied characteristics for optionable U.S. stocks from 2004 to 2023, screen them to 20 representative long-short factors, and test each ag |
| PriceBench: A Diagnostic Benchmark for Price, Quality, and Brand Preferences in LLM Booking Agents | 28 Sep 2026 | arXiv q-fin | arXiv:2609.31468v1 Announce Type: new Abstract: LLMs increasingly act as purchasing agents, which makes the LLM, not the user, the one choosing among the options that satisfy a request; its preferences quietly fix what gets bought and what it costs. Hotel booking is a clean instance: a high-volume |
| Tolerable Inflation, Intolerable Uncertainty | 28 Sep 2026 | arXiv q-fin | arXiv:2609.31512v1 Announce Type: new Abstract: Numerical inflation targets anchor beliefs. Across euro-area and US professional forecasts, inflation swaps and options, and realized inflation, uncertainty about inflation is compressed at the announced number and kinks exactly there. This paper iden |
| Financial Fragility in Societies of LLM Agents: Coordination Failures and Stabilizing Mechanisms | 28 Sep 2026 | arXiv q-fin | arXiv:2609.30940v1 Announce Type: cross Abstract: Individually protective decisions can produce avoidable collective failures. As large language model (LLM) agents take on greater roles in financial decision-making, financial AI safety must therefore be considered not only at the level of individua |
| Same Text, Different Numbers: The Divergence of LLM-Based Measures | 28 Sep 2026 | arXiv q-fin | arXiv:2609.31013v1 Announce Type: cross Abstract: Researchers increasingly use generative large language models (LLMs) to convert corporate text into empirical variables. We examine the extent to which LLM-based textual measures are invariant to model choice using thirteen measures, including senti |
| Gatheral's Conjecture Revisited | 28 Sep 2026 | arXiv q-fin | arXiv:2609.05047v5 Announce Type: replace Abstract: We consider the Heston model with perfect negative spot--variance correlation and its one-dimensional local-volatility projection. Let $I_T^{\mathrm H}$ and $I_T^{\mathrm{LV}}$ denote their respective integrated variances over $[0,T]$. We establis |
| Universal Diffusion Models for Implied Volatility Surfaces: Learning Shared Dynamics Across Stocks | 28 Sep 2026 | arXiv q-fin | arXiv:2609.22893v2 Announce Type: replace Abstract: Modeling the dynamics of option implied volatility surface (IVS) is crucial for pricing, hedging, and risk-managing option portfolios. We develop a universal conditional diffusion model that learns to jointly generate next-day IVS increments and t |
| FEDS Note: Decoupling Direct Investment: American Firms’ Retreat from China | 25 Sep 2026 | Fed FEDS Notes | Cody Kallen For decades, China was a major destination for foreign direct investment (FDI) by U.S. companies. In the last decade, however, trade tensions, geopolitical risks, and investment screening have interrupted these FDI flows and led firms to shift production toward third countries (Reyes-H |
| Treasury Trading at the Close | 22 Sep 2026 | NY Fed Liberty Street | In past work , we showed that trading in U.S. Treasury securities is becoming increasingly concentrated on the last trading day of each month. In this post, we show that trading is also becoming more concentrated around the designated pricing, or “strike,” times for fixed-income indexes. The concent |
| FEDS Note: Revisiting China's Current Account: Evidence from Recent Revisions | 22 Sep 2026 | Fed FEDS Notes | Harun Alp , Sina Ates , Colin Caines , Nathan Converse , Jasper Hoek , and Eva Van Leemput Global imbalances have returned to the forefront of policy debates, with China at the center of those discussions. China's trade surplus has reached exceptionally large levels, raising concerns about its imp |
| The New York Fed DSGE Model Forecast—September 2026 | 18 Sep 2026 | NY Fed Liberty Street | This post presents an update of the economic forecasts generated by the Federal Reserve Bank of New York’s dynamic stochastic general equilibrium (DSGE) model. We describe very briefly our forecast and its change since June 2026 . The New York Fed DSGE model expects similar growth, and slightly more |
| FEDS Note: New Forms of Money and the U.S. Monetary Aggregates | 4 Sep 2026 | Fed FEDS Notes | Kristen Payne and Mary-Frances Styczynski The money supply is defined as a group of safe assets with stable values that households and businesses can use to make payments or to hold as short-term investments. In the U.S., the Federal Reserve measures the money supply using officially defined monet |
| Jackson Hole: Exploring the Financial Frontier | 3 Sep 2026 | NY Fed Liberty Street | After two days of heady discussions with academics and policymakers from around the world in high-altitude Jackson Hole, Wyoming, I’m now decompressing back at Street Level . The main theme of this year’s Kansas City Fed symposium was financial innovation in the payments space—a fast-evolving topic |
| FEDS Note: Which states are most exposed to tariff increases? A new measure based on the consumption channel | 3 Sep 2026 | Fed FEDS Notes | Nick Heyman, Colin J. Hottman , and Ryan Monarch This note examines the heterogeneous exposure of states in terms of their consumption of direct consumer goods imports, which is an important channel through which states are exposed to increases in trade costs such as tariffs. Building on the metho |
| FEDS Note: Why Gold Didn't Actually Overtake Treasury Securities as the World's "Favorite" Reserve Asset | 3 Sep 2026 | Fed FEDS Notes | Colin Weiss In 2025, world international reserves held in gold surpassed foreign official holdings of U.S. Treasury securities (figure 1), a fact drawing attention from media and policymakers (Nangle, 2025; European Central Bank, 2026; Storbeck and Hook, 2026, for example). Should this be interpre |
| FEDS Note: Revisiting the Forecasting Potential of Futures Prices | 3 Sep 2026 | Fed FEDS Notes | Alex Haag, Colin J. Hottman , and Amanda Tinkham Amid the largest global oil supply shock in history, oil futures prices moved up much less than many expected. The steep backwardation in oil futures from the Strait of Hormuz's closure sparked a spirited debate over whether futures prices were too |
| Are Central Banks Moving Out of Dollar Assets? | 2 Sep 2026 | NY Fed Liberty Street | The dollar’s share of global official foreign exchange reserves fell from 64 percent in 2015 to 56 percent in 2025. This downward trajectory is sometimes read as evidence that the dollar’s role in international financial markets is eroding. However, aggregate statistics obscure the composition of ch |
| Businesses Are Using AI to Transform Work, Not Cut Jobs | 1 Sep 2026 | NY Fed Liberty Street | The ongoing advancement and adoption of artificial intelligence continues to raise concerns about widespread job losses. Over the past three years, our regional business surveys have asked firms about their AI adoption and its effects on their workforces. This year, we found that AI use among region |
| Has Broader Stock Market Participation Changed How Interest Rates Affect the Economy? | 19 Aug 2026 | NY Fed Liberty Street | Stock market participation in the U.S. has changed dramatically over the past four decades. In the mid-1980s, fewer than 30 percent of households held equity. By the early 2000s, more than half of U.S. households owned equity, either directly or through mutual funds, 401(k)s, and IRAs. As participat |
| Does the Equity Term Structure Respond to Monetary Policy Shocks? | 12 Aug 2026 | NY Fed Liberty Street | A long-standing body of research, inspired by Bernanke and Kuttner (2005), has documented the effects of Fed interest rate surprises on stock markets. While stock markets provide valuable information about the investor risk premium and dividend growth expectations, researchers have only recently dev |
| (How) Do We Teach Emotions? -- by Anjali Adukia, Matthew Bonci, Paula Dastres Gallardo, Emileigh Harrison, Jake Nicoll, Teodora Szasz | NBER working papers | Emotional intelligence constitutes a key component of human capital, shaped partially by educational materials. Using machine learning and generative AI tools, we examine emotional content in public-school textbooks and children’s literature. A stark mismatch emerges: text exposes children to a broa | |
| The Macroeconomic Effect of AI: Sizing the Software Engineering Channel -- by Alex Blumenfeld, Jonathon Hazell, Chen Lian, Andreas Schaab | NBER working papers | We measure how artificial intelligence (AI) affects the economy through its impact on software engineering productivity. We use information from financial markets to develop a forward-looking measure that is available in real time. We estimate the sensitivity of each firm’s stock return to an AI sto | |
| The Early Impacts of AI on Employment among Recent College Graduates -- by Robert W. Fairlie, Jane Wu | NBER working papers | The impact of AI on the employment prospects of recent college graduates is hotly debated with no consensus on the magnitude of impacts nor even the timing of those potential impacts. Using CPS microdata, we provide the first estimates of the effects of AI on the unemployment of recent college gradu | |
| Property Rights Uncertainty, Prices, and Speculation: Evidence from China's Housing Market -- by Hanming Fang, Jing Wu, Vincent Yao | NBER working papers | We examine the causal effect of uncertainty in property rights on housing prices and speculative behavior. We take advantage of a distinctive setting in Shenzhen, China, where neighboring residential units that are otherwise similar differ in the strength of their property rights protections. Some u | |
| Shipping to America -- by Xiwen Bai, Jesús Fernández-Villaverde, Yiliang Li, Ricardo Marto, Francesco Zanetti | NBER working papers | We study the macroeconomic and trade-policy implications of disruptions to U.S.-bound shipping routes. Standard models treat them as iceberg-cost shocks, conflating the shock with the response to it. Using satellite vessel-tracking data, we construct route-level measures of potential and effective c | |
| Transportation Bottlenecks and Aggregate Shocks -- by Giulia Brancaccio, Myrto Kalouptsidi, Theodore Papageorgiou, Yixin Zhou | NBER working papers | Do transportation disruptions affect aggregate outcomes? We develop a tractable model of the transportation sector to study its impact on prices and international trade. By casting maritime transportation as a queueing network, the model identifies where the transportation bottlenecks lie and delive | |
| Early Results from the RESET Demonstration Project: Inflation in Food at Home -- by Steve Coffey, Gabriel Ehrlich, John C. Haltiwanger, Ron S. Jarmin, David Johnson, Tod Johnson, Matthew D. Shapiro | NBER working papers | This paper presents early results from the RESET Demonstration Project, an initiative that constructs price and sales indices using item-level transactions data. The project’s overarching goal is to demonstrate the feasibility and advantages of leveraging modern transactions data for economic measur | |
| Timing, Trading Frictions, and the Limits of Subsidy Capture in Livestock Risk Protection -- by Yifei Zhang, Andrew Keller, Shawn Arita, Sandro Steinbach | NBER working papers | Publicly subsidized insurance programs can create incentives for subsidy capture when insured products closely resemble privately traded financial instruments. Livestock Risk Protection (LRP) is one such case because it provides price insurance through a contract that closely resembles an exchange-t |
Source: Fed FEDS Notes; NBER working papers; NY Fed Liberty Street; arXiv q-fin
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