- Goldman Sachs estimates $5.6B in passive outflows from MSCI removal.
- Another $2.7B at risk if FTSE Russell follows.
- MSCI launched consultation on reclassifying Indonesia to standalone.
- No immediate passive selling from the proposal.
- Avoiding reclassification needs clear evidence of consistent reforms.
- Goldman Sachs analysts estimate that a full removal of Indonesian stocks from MSCI indexes could trigger about $5.6 billion in passive outflows. MSCI launched a consultation last week on reclassifying Indonesia to standalone from emerging-market status. Another $2.7 billion is at risk if FTSE Russell follows. The proposal does not spark immediate passive selling. Avoiding reclassification requires clear evidence of consistent reforms.
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