Pretty much as predicted, the current account deficit expanded to US$9.1 billion in the second quarter of 2014, equivalent to 4.27% of the gross domestic product (GDP), the highest level since the second quarter of 2013. While this might be considered seasonal, due to payment of dividends and debts, we can’t ignore the fact the depreciation of rupiah hurts more long-term prospect of domestic economy than rebalancing the external trade.

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