Continuously weakening Indonesian exports and imports signal that demand from both Indonesia and the world have declined hence pointing at reduced economic activity.

Cumulatively, Indonesia’s trade balance improved to USD $3.75 billion in the first five months of 2015. The trade surplus is important to curb Indonesia’s wide current account deficit. Since 2011 Indonesia has been plagued by a structural current account deficit and this puts additional pressure on the rupiah rate. This year so far the rupiah has depreciated 7.2 percent to IDR 13,333 per US dollar on bullish US momentum (ahead of further monetary tightening in the USA) in combination with Indonesia’s weak macroeconomic data (especially current account deficit and slowing economic growth).

Statistics Indonesia also revised the country’s April trade surplus to USD $480 million, up from the earlier USD $454 million surplus it reported last month. April exports were revised to USD $13.1 billion from USD $13.08 billion, while imports were left unchanged at USD $12.63 billion.

Bahas