A closer look at the data shows that Indonesia's exports were better than expected, while growth of imports moderated. Indonesia's exports rose 6.14 percent year-on-year (y/y) to USD $15.58 billion in March 2018. Albeit this is a weaker growth pace than the 12.0 percent (y/y) in the preceding month, it is much better than analysts' consensus of 1.7 percent (y/y). March exports were supported by a marked increase in exports of herbs, coffee and corn.

Suhariyanto added that Indonesia's rising exports also stemmed from the industry and mining sectors. For example, a significant amount of coal, lignite, and steel were exported to China. Meanwhile, exports of gas slowed, hence the value of the nation's oil & gas exports fell 3.81 percent month-on-month (m/m) to USD $1.3 billion.

Cumulatively, the value of Indonesia's exports in the period of January-March 2018 reached USD $44.3 billion, up 8.78 percent from exports in the same period one year earlier.

Meanwhile, imports into Indonesia grew 9.07 percent (y/y) to USD $14.49 billion in March, much slower than February's 24.94 percent (y/y) growth pace, and falling below analysts' estimates that averaged 13.0 percent.

Cumulatively, the value of Indonesian imports in the first quarter of 2018 reached USD $44.0 billion, up 20.1 percent (y/y).

Suhariyanto added that the nation's industrial materials and capital goods made up over 90 percent of total imports in the first quarter of 2018, up 8.35 percent (y/y) and 27.72 percent (y/y), respectively. Imports of consumption goods were down almost 10 percent (y/y) in March and contributed only 9.0 percent to total imports that month.

Composition of Indonesian Imports:

A high amount of imports of raw materials and capital goods are signs that manufacturing activity is rising (implying that household consumption is improving because without signs of improving household consumption manufacturing companies will not boost output).

Due to the big trade surplus in March, Indonesia's overall trade balance in the first quarter of 2018 swung back into surplus (USD $282.8 million). In the first two months of 2018 the country recorded two monthly trade deficits (USD $756 million in January and - a revised - USD $53 million in February), hence most analysts expected the Q1-2018 balance to be negative. This would have caused additional pressures on the country's current account balance. However, the big trade surplus in March should keep the current account deficit from passing beyond the 2 percent of gross domestic product (GDP) level in Q1-2018.

Still, the USD $282.8 million trade surplus in Q1-2018 is much lower compared to the USD $4.1 billion trade surplus in Q1-2017. Moreover, the current account deficit at 2.0 percent of GDP implies some widening from the 1.7 percent of GDP deficit in FY-2017 (although it remains at a sustainable level).

Based on the BPS data, Indonesia posted the biggest surpluses in the period of January-March 2018 in trade with the United States (USD $2.28 billion), India (USD $2.09 billion, and the Netherlands (USD $678 million).

Meanwhile, Indonesia runs its biggest trade deficits with China (USD $3.81 billion), Thailand (USD $1.1 billion), and Australia (USD $602 million).