diff --git a/language-configuration.json b/language-configuration.json
index b8e9fac1..c8af8bf2 100644
--- a/language-configuration.json
+++ b/language-configuration.json
@@ -31,7 +31,7 @@
     }
   },
   "indentationRules": {
-    "increaseIndentPattern": "^\\s*.*(:|-) ?(&\\w+)?(\\{[^}\"']*|\\([^)\"']*)?$",
+    "increaseIndentPattern": "^\\s*.*(:|-) ?(&[^\\s,\\[\\]{}]+)?(\\{[^}\"']*|\\([^)\"']*)?$",
     "decreaseIndentPattern": "^\\s+\\}$"
   },
   "wordPattern": "(^.?[^\\s]+)+|([^\\s\n={[][\\w\\-\\.\/$%&*:\"']+)"
diff --git a/test/languageConfiguration.test.ts b/test/languageConfiguration.test.ts
new file mode 100644
index 00000000..2f30cdee
--- /dev/null
+++ b/test/languageConfiguration.test.ts
@@ -0,0 +1,22 @@
+/*---------------------------------------------------------------------------------------------
+ *  Copyright (c) Red Hat, Inc. All rights reserved.
+ *  Licensed under the MIT License. See License.txt in the project root for license information.
+ *--------------------------------------------------------------------------------------------*/
+
+import * as assert from 'assert';
+import * as fs from 'fs';
+import * as path from 'path';
+
+describe('Language configuration', () => {
+  it('increases indentation after a key or list item with an anchor', () => {
+    const configPath = path.resolve(__dirname, '..', '..', 'language-configuration.json');
+    const config = JSON.parse(fs.readFileSync(configPath, 'utf8'));
+    const increaseIndentPattern = new RegExp(config.indentationRules.increaseIndentPattern);
+    assert.ok(increaseIndentPattern.test('base: &base'));
+    assert.ok(increaseIndentPattern.test('- &item'));
+    assert.ok(increaseIndentPattern.test('second: &ref-erance'));
+    assert.ok(increaseIndentPattern.test('- &item.v2'));
+    assert.ok(!increaseIndentPattern.test('key: value'));
+    assert.ok(!increaseIndentPattern.test('- item'));
+  });
+});