Indonesia Economic Forecast

Indonesia Economic Outlook

February 19, 2019

The economy posted a healthy expansion in the fourth quarter according to recent figures. Private consumption growth was brisk, likely supported by social assistance programs ahead of the April elections, modest price pressures and a robust labor market. Moreover, fixed investment and government expenditure grew notably, while the external sector’s drag on the economy lessened on softer import growth. This came after a similarly robust outturn in Q3 on dynamic domestic demand. Turning to 2019, the economy has had a soft start. The manufacturing sector began the year on weak footing, with the PMI broadly stagnating in January due to lower new orders. Moreover, on the external front, exports shrank in the same month due to declines in the energy and non-energy sectors; although imports also fell—partly due to a tough base effect—the trade balance worsened in annual terms as a result.

Indonesia Economic Growth

Domestic demand should continue to support growth this year, with private consumption underpinned by a strong labor market and government consumption likely receiving a slight boost ahead of elections in April. However, potential delays to public infrastructure projects and cooling Chinese momentum could drag on the performance, while a possible resurgence of U.S.-China trade tensions poses a downside risk to the outlook. FocusEconomics panelists see GDP expanding 5.1% in 2019, which is unchanged from last month’s forecast, and 5.2% in 2020.

Indonesia Economy Data

Population (million)249252255259262
GDP per capita (USD)3,6723,5323,3693,6053,876
GDP (USD bn)9148918619331,015
Economic Growth (GDP, annual variation in %)
Consumption (annual variation in %)
Investment (annual variation in %)
Manufacturing (annual variation in %)
Retail Sales (annual variation in %)12.914.513.311.02.9
Unemployment Rate6.
Fiscal Balance (% of GDP)-2.2-2.1-2.6-2.5-2.6
Public Debt (% of GDP)22.024.327.528.930.5
Money (annual variation in %)12.811.
Inflation Rate (CPI, annual variation in %, eop)
Inflation Rate (CPI, annual variation in %)
Inflation (WPI, annual variation in %)-  -  -  -  -  
Policy Interest Rate (%)7.507.757.504.754.25
Stock Market (annual variation in %)-1.022.3-12.115.320.0
Exchange Rate (vs USD)12,17012,38513,78813,47313,568
Exchange Rate (vs USD, aop)10,44911,86613,39213,30213,383
Current Account (% of GDP)-3.2-3.1-2.0-1.8-1.7
Current Account Balance (USD bn)-29.1-27.5-17.5-17.0-17.5
Trade Balance (USD billion)-4.1-
Exports (USD billion)183176150145169
Imports (USD billion)187178143136157
Exports (annual variation in %)-3.9-3.6-14.6-3.416.3
Imports (annual variation in %)-2.6-4.5-19.9-4.915.7
International Reserves (USD)99.4112106116130
External Debt (% of GDP)29.132.936.134.334.8

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Indonesia Facts

Bond Yield7.96-0.05 %Mar 11
Exchange Rate14,2900.05 %Mar 11
Stock Market6,366-0.32 %Mar 11

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