Indonesia: Exports contract in July, but trade balance returns to surplus on steeper decline in imports
September 1, 2014
Exports fell 6.0% in July over the same month last year and contrasted the 4.4% increase observed in June. Non-oil and gas exports, which account for the majority of Indonesian shipments, decreased 9.2% in July (June: +5.6% year-on-year). Oil and gas exports rebounded to an 11.6% increase (June: -0.5% yoy). Meanwhile, imports plunged from a 0.4% expansion in June to a 19.3% contraction in July. This marked the steepest drop in imports since September 2009, and was driven by a decline in demand during the holy month of Ramadan.
The trade balance swung from a USD 288 million deficit in June to a USD 124 million surplus, which greatly contrasted the USD 2.3 billion shortfall recorded in the same month last year. Moreover, the reading contrasted USD 427 deficit the market had expected. Meanwhile, the 12-month moving sum of the trade balance posted a surplus of USD 0.6 billion in July, which was a turnaround from the USD 1.9 billion deficit observed in June.
Author: Carl Kelly, Economist