As expected, Indonesia’s manufacturing activity contracted again in May 2020, albeit at a slightly slower pace. The latest IHS Markit Indonesia Manufacturing Purchasing Managers’ Index (or PMI) rose to a reading of 28.6 points in May 2020, up from the all-time low of 27.5 in April 2020. A reading below 50.0 indicates contraction in the country’s manufacturing activity, while a reading above 50.0 indicates expansion.

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Indonesia’s inflation rate was unusually mild in May 2020. According to the latest data from Statistics Indonesia (BPS), the country’s consumer price index (CPI) stood at 0.07 percent month-on-month (m/m) only.

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Most companies and industries have been under huge pressure since the Indonesian government imposed a range of restrictions (specifically on people’s movement and business activities) in an effort to curb the further spread of the novel coronavirus (COVID-19). As most companies experience a massive decline in sales, it has become difficult for these companies to finance their operating costs and expenses. And, the longer the restrictions last, the bigger companies’ financial burdens become.

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On Wednesday (03/06/2020) Indonesia Investments released the May 2020 edition of its monthly report. In this edition, titled 'in the Eye of the Storm', we focus specifically on the social implications of the novel coronavirus (COVID-19) crisis on Indonesian society. Hence, unemployment and poverty are two topics that deserve specific attention.

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