Indonesian foreign direct investment (FDI) is predicted to increase to 19 billion U.S. dollars this year from that of 18 billion U.S. dollars last year as the country has obtained the second investment grade status from Moody's Investor Service, director at central bank said here on Thursday.

The statement was made after Moody's raised Indonesia's sovereign debt rating to Baa3 from Ba1 with stable outlook on Wednesday after Fitch's rating agency did similar suit on Dec. 15, in which it raised Indonesia's sovereign debt status from BB+ to BBB-.

"With the rise of the status, I am certain the amount of funds flowing into FDI in 2012 is going to be higher. I predict to about 19 billion U.S. dollars," Perry Warjiyo, director of research of economic and monetary policy at the central bank.

Having investment grade status from two leading rating agencies has made Indonesia to receive more capital inflows, as foreign investor would start to execute their investment plan.

The director also predicted the foreign capitals were also going to flow into portfolio, though in a short term the crisis in the Europe would remain impact on it that the figure was lower than that of last year.

"Investment on portfolio is forecast to be higher, it is about 4 billion U.S. dollars. Despite the crisis in the Europe will slow them," he said at the central bank office.

The amount of funds flowing into portfolio in 2011 reached 5 billion U.S. dollars.

The flowing of the funds to the FDI and portfolio was expected to appreciate rupiah against the U.S. dollar, said Warjiyo.

Xinhua