Indonesia: Trade deficit widens to record high in July
September 2, 2013
Exports fell for the 16th consecutive month in July and contracted 6.1% over the same month last year, which followed the 4.4% decline observed in June.
Non-oil and gas exports, which account for a majority of Indonesian shipments, contracted 2.6% in July (June: -4.7% yoy). Oil and gas exports dropped 21.8% (June: -3.4% yoy).
At the same time, imports rebounded to a 6.5% increase in July, which contrasted the 6.5% decrease recorded in June.
The trade deficit reached a record high USD 2.3 billion in July, which was far larger than the USD 877 million shortfall registered in June. Moreover, the print greatly contrasted market expectations of a reduction in the deficit to USD 389 million. As a result, the 12-month moving sum of the trade balance reached a record shortfall of USD 7.6 billion, exceeding the USD 5.5 billion deficit observed in June.
FocusEconomics Consensus Forecast panellists expect exports to expand 0.7% and the trade surplus to reach USD 0.3 billion in 2013. For 2014, the panel expects exports to grow 10.9% and the trade surplus to widen to USD 4.2 billion.
Author: Carl Kelly, Economist