Indonesia Economic Forecast

Indonesia Economic Outlook

March 20, 2018

According to available indicators, the economy continued to perform robustly in Q1. Consumer confidence remained elevated in the first two months of the year: This, together with declining inflation, bodes well for private consumption, a picture only partially obscured by a dip in retail sales in January. Moreover, the manufacturing PMI returned to positive territory in February pushed up by rising output and new orders, suggesting fixed investment continued to expand healthily on the back of the government’s ongoing infrastructure push. However, S&P Global Ratings recently warned that the current increase in development spending risks deteriorating the balance sheets of state-owned enterprises (SOEs) and thus affecting the banking system. As the government aims to lower the fiscal deficit, SOEs are borrowing heavily to finance infrastructure projects, which is translating into higher leverage levels. If protracted, this trend could force SOEs to scale down investment spending or turn to the public coffers for recapitalization.

Indonesia Economic Growth

A strong expansion in public infrastructure spending and rising private investment and FDI inflows on the back of higher commodity prices will spur growth this year. Moreover, relatively subdued inflationary pressures and an accommodative monetary policy will support private consumption. However, faster hikes in U.S. interest rates could drive capitals out of the country, prompting a tightening in financing conditions and weakening the currency. FocusEconomics panelists see GDP expanding 5.3% in 2018, unchanged from last month’s forecast. In 2019, the economy is seen growing 5.4%.

Indonesia Economy Data

20122013201420152016
Population (million)245249-  -  -  
Population (million)245249-  -  -  
GDP per capita (USD)3,7503,672-  -  -  
GDP per capita (USD)3,7503,672-  -  -  
GDP (USD bn)920914-  -  -  
GDP (USD bn)920914-  -  -  
Economic Growth (GDP, annual variation in %)6.05.6-  -  -  
Economic Growth (GDP, annual variation in %)6.05.6-  -  -  
Consumption (annual variation in %)5.55.4-  -  -  
Consumption (annual variation in %)5.55.4-  -  -  
Investment (annual variation in %)9.15.0-  -  -  
Investment (annual variation in %)9.15.0-  -  -  
Manufacturing (annual variation in %)5.64.4-  -  -  
Manufacturing (annual variation in %)5.64.4-  -  -  
Retail Sales (annual variation in %)14.512.9-  -  -  
Retail Sales (annual variation in %)14.512.9-  -  -  
Unemployment Rate6.16.2-  -  -  
Unemployment Rate6.16.2-  -  -  
Fiscal Balance (% of GDP)-1.8-2.2-  -  -  
Fiscal Balance (% of GDP)-1.8-2.2-  -  -  
Public Debt (% of GDP)21.422.0-  -  -  
Public Debt (% of GDP)21.422.0-  -  -  
Money (annual variation in %)15.012.8-  -  -  
Money (annual variation in %)15.012.8-  -  -  
Inflation Rate (CPI, annual variation in %, eop)3.78.1-  -  -  
Inflation Rate (CPI, annual variation in %, eop)3.78.1-  -  -  
Inflation Rate (CPI, annual variation in %)4.06.4-  -  -  
Inflation Rate (CPI, annual variation in %)4.06.4-  -  -  
Inflation (WPI, annual variation in %)5.16.0-  -  -  
Inflation (WPI, annual variation in %)5.16.0-  -  -  
Policy Interest Rate (%)5.757.50-  -  -  
Policy Interest Rate (%)5.757.50-  -  -  
Stock Market (annual variation in %)12.9-1.0-  -  -  
Stock Market (annual variation in %)12.9-1.0-  -  -  
Exchange Rate (vs USD)9,63812,170-  -  -  
Exchange Rate (vs USD)9,63812,170-  -  -  
Exchange Rate (vs USD, aop)9,36210,449-  -  -  
Exchange Rate (vs USD, aop)9,36210,449-  -  -  
Current Account (% of GDP)-2.7-3.2-  -  -  
Current Account (% of GDP)-2.7-3.2-  -  -  
Current Account Balance (USD bn)-24.4-29.1-  -  -  
Current Account Balance (USD bn)-24.4-29.1-  -  -  
Trade Balance (USD billion)-1.7-4.1-  -  -  
Trade Balance (USD billion)-1.7-4.1-  -  -  
Exports (USD billion)190183-  -  -  
Imports (USD billion)192187-  -  -  
Imports (USD billion)192187-  -  -  
Exports (annual variation in %)-6.6-3.9-  -  -  
Exports (annual variation in %)-6.6-3.9-  -  -  
Imports (annual variation in %)8.0-2.6-  -  -  
Imports (annual variation in %)8.0-2.6-  -  -  
International Reserves (USD)11399.4-  -  -  
International Reserves (USD)11399.4-  -  -  
External Debt (% of GDP)27.429.1-  -  -  
External Debt (% of GDP)27.429.1-  -  -  

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Indonesia Facts

ValueChangeDate
Bond Yield6.75-0.05 %Apr 20
Exchange Rate13,8780.05 %Apr 20
Stock Market6,338-0.32 %Apr 20

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