Indonesia Economic Forecast

Indonesia Economic Outlook

November 17, 2020

The economy contracted sharply in Q3 according to recent data, although at a softer rate than in Q2. Private consumption and fixed investment were both down notably amid lingering domestic social mobility restrictions. However, public spending surged as the government was finally able to expedite stimulus measures. Moreover, the external sector contributed markedly to GDP—albeit largely due to import compression, as exports continued to fall markedly. Turning to the fourth quarter, early signs are muted amid ongoing restrictions in Jakarta and stubbornly high infection rates. In October, the manufacturing PMI continued to signal deteriorating operating conditions, while consumer sentiment worsened, and retail sales contracted at a sharper rate according to preliminary estimates.

Indonesia Economic Growth

The economy is set to rebound next year, supported by fiscal and monetary stimulus and the likely lessening impact of Covid-19. Moreover, the passage of the omnibus bill could buoy investment to an extent. However, uncertainty over the evolution and duration of the pandemic and the timing of a vaccine clouds the outlook. FocusEconomics Consensus Forecast panelists expect GDP to expand 5.0% in 2021, which is unchanged from last month’s forecast. In 2022, GDP is seen growing 5.1%.

Indonesia Economy Data

2015 2016 2017 2018 2019
Population (million)256258261264267
GDP per capita (USD)3,3683,6073,8853,9464,194
GDP (USD bn)8619321,0151,0421,120
Economic Growth (GDP, annual variation in %)4.95.05.15.25.0
Consumption (annual variation in %)5.05.04.95.15.0
Investment (annual variation in %)5.04.56.26.64.4
Manufacturing (annual variation in %)4.34.34.34.33.8
Retail Sales (annual variation in %)13.311.02.93.73.9
Unemployment Rate6.25.65.55.35.3
Fiscal Balance (% of GDP)-2.6-2.5-2.6-1.7-2.2
Public Debt (% of GDP)27.028.029.430.130.4
Money (annual variation in %)9.010.08.36.36.5
Inflation Rate (CPI, annual variation in %, eop)3.43.03.63.22.6
Inflation Rate (CPI, annual variation in %)6.43.53.83.32.8
Inflation (WPI, annual variation in %)-  -  -  -  -  
Policy Interest Rate (%)7.504.754.256.005.00
Stock Market (annual variation in %)-12.115.320.0-2.51.7
Exchange Rate (vs USD)13,78813,47313,56814,38013,883
Exchange Rate (vs USD, aop)13,39213,30213,38314,23314,141
Current Account (% of GDP)-2.0-1.8-1.6-2.9-2.7
Current Account Balance (USD bn)-17.5-17.0-16.2-30.6-30.4
Trade Balance (USD billion)7.79.511.8-8.7-3.2
Exports (USD billion)150145169180167
Imports (USD billion)143136157189171
Exports (annual variation in %)-14.6-3.416.36.6-7.0
Imports (annual variation in %)-19.9-4.915.720.2-9.5
International Reserves (USD)106116130121129
External Debt (% of GDP)36.134.334.736.036.1

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Indonesia Facts

Value Change Date
Bond Yield7.10-0.05 %Dec 31
Exchange Rate13,8830.05 %Jan 01

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