The Today's Headlines section of Indonesia Investments is a regularly updated section which contains the latest information with regard to topics that are currently causing headlines in Indonesia's media. Most of our headlines cover political, economic and social matters. As a consequence of their recent nature, these topics may not have crystallized fully yet and can, therefore, lack a profound analysis. For publications with a more in-depth understanding of subjects, we refer you to our News, Financial or Business columns.
It was a remarkable first trading day of the year in Indonesia. Indonesia's benchmark Jakarta Composite Index showed a very volatile performance, starting in the red, then rising sharply to +1.32 percent around noon, and then falling to close 0.26 percent in the red zone at 6,339.24 points.
At a news conference on Tuesday (02/01), Indonesian Finance Minister Sri Mulyani Indrawati said Indonesia's unaudited budget deficit reached 2.57 percent of the country's gross domestic product (GDP) in 2017, slightly below expectations at 2.60 percent of GDP, and well below the government's 2.92 percent (revised) target. In 2016 the government budget deficit was recorded at 2.49 percent of GDP.
Indonesia's consumer price index (CPI) finished the year 2017 at the level of 3.61 percent year-on-year (y/y), slightly higher than analysts' forecasts but well within the government's full-year inflation target of 4.3 percent. Indonesian full-year 2017 inflation was the nation's highest annual inflation since 2014 when inflation surged to 8.36 percent (y/y) due to fuel subsidy reforms.
Indonesia's current account balance is expected to show a deficit for the next five years. The central bank of Indonesia (Bank Indonesia) does not rule out a surplus within that period but it would require some serious work in terms of structural reform-making. Indonesia started to record current account deficits in late-2011 due to the ballooning oil import bill (before the government slashed energy subsidies) and weak commodity prices after 2011.
