Getting sovereign credit rating upgrades and achieving investment grade status are main goals
for countries in order to gain lower yield spread and cost of borrowing. By using ordinary least
square method, this research is aimed to analyze the impact of Indonesia sovereign credit rating upgrade
and investment grade status on sovereign spread changes. The result shows that the sovereign
credit rating upgrades within speculative grade category and investment grade status for Indonesia
do not significantly impact sovereign spread reduction. On the other hand, the global condition, especially
global risk appetite, has significant impact to Indonesia sovereign yield spread. The research
also indicates that Indonesia macroeconomic fundamentals do not significantly explain the movement
of sovereign yield spread.
