Indonesian growth is unexpectedly expected by 5.12 %, challenges weak lending

The country’s statistics office announced on Tuesday that the gross domestic product in the three months to June was 5.12 % from last year. This victory over slowing expectations to 4.8 % growth, according to an average estimate in the Bloomberg survey. Rubia did not change slightly at 16,384 to the dollar, while stocks increased from gains to 1 % after data.

Economists were surprised. Outside of the epidemic, the contradiction between the prediction and actual data was the largest since the first quarter of 2014, according to the data collected by Bloomberg. While the economy may have benefited from interest rate cuts, government motivation, and Eid Al Fitr season, analysts are divided into expectations.

“I doubt that the investment growth will continue in the second half of the year,” said Ahmed Michael Zini, chief economist at PT SUCOR Sekuritas in Jakarta, noting the slowdown in the growth of loans and deflation in foreign direct investment in June.

In contrast, the economist at Danamon Bank of Indonesia, Hossana, said the rating of numbers in the third quarter, in the third quarter, “this improvement can continue,” thanks to government motivation; Spending free school meals and other projects; Supporting monetary policy; And flexible agricultural output.

BPS said that the total formation of fixed capital got 6.99 % in the second quarter, which is the fastest pace in four years, due to the development of infrastructure and spending on machinery.

However, there are also questions about the reliability of statistics.

“We have no great belief in the data,” said Capital Economists in a report after the announcement. “We have long witnessed concerns about the reliability of GDP data in Indonesia. Before the epidemic, Indonesia went for about six years as the official official GDP growth was barely moved from 5 % on an annual basis. In recent years, GDP growth began, again, hovering around the same rate.”

Special consumption, which represents more than half of GDP in the country, increased 4.97 %.

“This is still 5.0 % lower in the contract that precedes the Covid-19-equaling that consumers are still cautious,” said Tamara Mast Henderson in a report on Bloomberg Economic.

In fact, there was Huge numbers One of the missing functions in the fabric and other industries, as Chinese exporters threw goods in a nation of 280 million people. The United States’ imposition of difficult definitions may have added to pressure on Beijing to find new markets.

The largest economy in Southeast Asia expanded by 4.04 % on a quarterly basis, and more than 3.69 % expansion expectations by economists. Exports increased by 10.67 %, helped by charges loaded in the front before waving the American definitions, which were reduced to 19 % of 32 % for Indonesia.

However, the external risks are still continuing due to the deterioration of the slowly trade war and the global economy, which can reduce the momentum of domestic demand and trade to move forward. The higher definitions of exports to the United States are identified on August 7.

Government spending decreased by 0.33 % in the second quarter of the previous year, amid the efforts made by President Prabu Subanto to re -present some government spending on favorite programs, including free school lunch.

PrabOWo is scheduled to reveal the government’s 2026 plans in his first budget speech on August 15, along with the goal of economic growth for this year. The government has already reduced the growth forecast for GDP of 2025 to 4.7 % to 5 %, from initial forecasts by 5.2 %, and said more financial incentives are being prepared to increase purchasing power during the end of the year.

There will also be more cash support. Since September, the Bank of Indonesia has reduced the main interest rate by 100 basis points pledge To continue to reduce economic growth and increase bank lending, which decreased to its lowest level in June for two years.

“It is unlikely that the strongest print is expected to grow in the second quarter of Indonesia-which was moved by investment and exports-” Hinderson of Bloomberg wrote: “The effect of the higher American definitions has not yet fallen. When this happens, growth will suffer.”