Indonesia Economic Outlook
November 13, 2018Economic growth dipped slightly in the third quarter but stayed solid, supported by domestic demand. Private consumption expanded robustly, likely supported by mild inflation, a healthy labor market and the Asian Games in August–September, while government consumption and fixed investment also grew at a fast pace. However, the external sector contributed negatively to growth. Looking at Q4, growth should remain robust thanks to ongoing strong private consumption. That said, the manufacturing PMI declined in October, while the recent tsunami and airplane crash could dampen tourist arrivals. At the end of October, parliament approved the 2019 budget—which had originally been presented in August—without major changes. GDP and inflation assumptions were unchanged, and the fiscal deficit target remained at 1.8% of GDP. However, estimates for expenditure and revenue, and the IDR/USD exchange rate, were raised slightly.
Indonesia Economic GrowthDomestic demand should continue to underpin the economy, with private consumption supported by a strong labor market and government consumption likely receiving a boost ahead of elections in April 2019. However, tighter monetary policy, delays to public investment projects, cooling Chinese demand and a possible resurgence of U.S.-China trade tensions pose downside risks. FocusEconomics panelists see GDP expanding 5.2% in 2019, down 0.1 percentage points from last month’s forecast, and 5.2% again in 2020.
Indonesia Economy Data
5 years of Indonesia economic forecasts for more than 30 economic indicators.
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|Bond Yield||8.14||-0.05 %||Nov 14|
|Exchange Rate||14,787||0.05 %||Nov 14|
|Stock Market||5,858||-0.32 %||Nov 14|
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Indonesia Economic News
November 6, 2018
In September, retail sales grew 4.8% over the same month last year, down from August’s 6.1% expansion but beating the Bank’s initial estimate of 3.7%.
November 5, 2018
The economy expanded 5.2% in the third quarter according to recent data released by Statistics Indonesia, down only marginally from Q2’s 5.3%—which had marked a multi-year high—and matching market expectations. Domestic demand drove growth in the quarter, with private consumption increasing 5.0% (Q2: +5.1% year-on-year), likely supported by a healthy labor market and subdued inflation boosting consumers’ purchasing power.
November 1, 2018
Consumer prices increased 0.28% in October from the previous month, contrasting September’s 0.18% fall.
November 1, 2018
Conditions in Indonesia’s manufacturing sector improved at a slower pace in October, according to the Purchasing Managers’ Index (PMI) released by IHS Markit and Nikkei, with the PMI decreasing from 50.7 to 50.5 in October.
Indonesia: Bank Indonesia leaves rates unchanged in October, but further tightening still likely looking ahead
October 23, 2018
At its 22–23 October monetary policy meeting, Bank Indonesia (BI) left the seven-day reverse repo rate unchanged at 5.75%, after hiking rates for the fifth time this year in September.