And, this is not unimportant considering retail sales are a leading macroeconomic indicator. Growth of these sales informs us that Indonesia’s consumer demand for finished goods (measured through purchases of durable and non-durable goods) has finally rebounded. Indeed, retail sales had already improved on a monthly basis (which, too, is positive as well as a strong indication that Indonesia is gradually on its way out of the COVID-19 crisis). However, we were still waiting for the rebound in retail sales on an annual basis as this would indicate that the present economic conditions are better than a year ago. This news would then certainly give rise to some more optimism in society.

There was initially hope that the rebound on an annual basis would occur in March 2021 as Indonesia had officially entered the COVID-19 crisis in March 2020 when – at the beginning of the month – the first two COVID-19 cases were confirmed in the country. Interestingly enough, at the start of the COVID-19 crisis last year March, it led to some hoarding and therefore retail sales did not drop heavily yet, hence retail sales still contracted 14.6 percent (y/y) in March 2021 (as they could not enjoy the low base effect yet).

However, April is a different story. In April 2020 we started seeing heavy lockdowns in urban centers across Indonesia (including the temporary closing of schools and shopping malls, while staff and other workers were forced to work from home, with the exception of vital sectors), and thereby triggering a much larger contraction in retail sales (a contraction that would peak in the following month: May 2020). These business and social restrictions curbed consumption significantly last year, reflected in the 16.9 percent (y/y) contraction in retail sales in April 2020.


Read the full article in the June 2021 report. This report can be ordered by sending an email to or a message to +62.882.9875.1125 (including WhatsApp).

Take a glance inside the report here!