Indonesia: Merchandise trade slips into deficit in May
Latest reading: In May, the trade balance was USD -0.6 billion, following a USD +1.1 billion reading in the previous month. This was the largest deficit since November 2019. Over the last 12 months, the trade balance summed to USD +39.6 billion.
Merchandise exports dropped 4.8% in annual terms in May, coming on the back of 22.2% growth in the previous month. Meanwhile, merchandise imports increased 22.7% in annual terms in May, following a 23.0% increase in the prior month.
Panelist insight: United Overseas Bank’s Enrico Tanuwidjaja and Vincentius Ming Shen commented:
“The end of Indonesia’s six-year trade surplus streak could potentially weigh on its current account deficit further. Persistent import growth—particularly in energy and capital goods—combined with a weaker rupiah, presents ongoing challenges. Meanwhile, export contraction underscores vulnerability to shifting global demand and tariff pressures (e.g., US reciprocal tariffs).”