The central bank (Bank Indonesia/BI) said national economic growth in Indonesia remains in line with the previous projection, at 5.0-5.4% for 2018, increasing thereafter to 5.1-5.5% in 2019, backed by domestic demand. Strong consumption data is supported by improving incomes and spending on the elections.
Solid investment growth is expected to persist, bolstered by building investment in relation to infrastructure projects and property as well as non-building investment.
Nevertheless, stronger export growth is expected to be restrained by weak agricultural exports despite improving manufacturing exports, boosted by the chemicals industry as well as iron and steel subsector. On the other hand, imports remain high on strong domestic demand, especially of capital goods as a corollary of increasing investment.