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21 April 2025 (closed)
Jakarta Composite Index (6,445.97) +7.70 +0.12%
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Latest Reports Consumer Confidence
The long Idul Fitri holiday (that ends on 7 April 2025) somewhat disrupts our access to Indonesia’s macroeconomic data as much of the private and public sector is closed during this holiday (hence do not release any data during this period).
On 5 February 2025, the Statistical Agency of Indonesia (Badan Pusat Statistik, BPS) announced that Indonesia’s gross domestic product (GDP) was recorded at a growth rate of 5.03 percent year-on-year (y/y) in 2024. In another article in this month’s edition, we devote an analysis concerning Indonesia’s 2024 GDP growth.
In last month’s report we saw that Indonesia’s official economic growth rate was (in line with expectations) quite strong at 5.11 percent year-on-year (y/y) in Q1-2024. Moreover, last month we also saw that most of the macroeconomic data point at the continuation of strong growth in Q2-2024 (with the only major exception being the country’s car sales data that still showed deep red numbers).
In this article we are taking a quick look at various macroeconomic data that help us assess the state of the Indonesian economy in the first quarter of 2024. This update is much more succinct than our normal economic update because we already have one article devoted to the Indonesian economy in this report (zooming in on the Q3-2023 and full-year gross domestic growth data of 2023).
At the annual meeting of Indonesia’s central bank (Bank Indonesia) at the very end of November 2023, Bank Indonesia Governor Perry Warjiyo said the central bank is optimistic about accelerating economic growth in the next two years (2024 – 2025).
As if the external environment wasn’t already challenging enough, a new geopolitical crisis broke out when military organization Hamas attacked Israel in the morning of 7 October 2023 (from the Gaza Strip), killing over 1,400 Israelis while taking hostage more than 200 people.
At the start of June 2022, the World Bank decided to cut its forecast for Indonesia’s economic growth in full-year 2022 from the level of 5.2 percent year-on-year (y/y) to 5.1 percent (y/y). Do we need to be concerned?
Based on the latest survey of Roy Morgan Indonesia, the local unit of global market research firm Roy Morgan Research, Indonesia's consumer confidence fell slightly in August 2017 to a reading of 151.7 points (down 0.4 points from the preceding month, which had been the highest reading in more than two years).
Indonesia improved in the consumer confidence index that is compiled and released by market research agency Nielsen. With 122 points Indonesia was the third-most confident nation in the world (after India and the Philippines) in the 3rd quarter of 2016. Compared to one year ago, Indonesia's score improved six points. Indonesia's consumer confidence has improved each quarter so far in 2016 amid accelerating economic growth, controlled inflation at around 3 percent (y/y), and a stable - or actually stronger - rupiah exchange rate.
According to the latest survey of Indonesia's central bank (Bank Indonesia), consumer confidence in Southeast Asia's largest economy fell 3.3 points to 110 in September 2016 (a reading above 100.0 indicates optimism). Consumer confidence somewhat weakened as the Indonesian people expect upward price pressures at the year-end, specifically rising prices of processed food, beverages, cigarettes, tobacco and groceries. Meanwhile, respondents also expect to put less money in savings in the next six months.
Latest Columns Consumer Confidence
Consumer goods producer Unilever Indonesia, one of Indonesia's leading consumer goods firms, is expected to show better corporate earnings in 2016 compared to the preceding years on improving purchasing power of Indonesia's population. The company's net profit is estimated to grow by 15 percent compound annual growth rate (CAGR) in the coming two years, while its EBIT margin is expected to remain above 23 percent as higher costs of raw materials are compensated by higher selling prices.
The Indonesian economy, from the expenditure side, is highly dominated by domestic demand. From Q1-2010 to Q1-2015, the average role of domestic demand reached 99.5 percent, with the lowest level at 96.8 percent. The positive side of this situation is that the Indonesian economy is relatively resilient to external factors. History shows that despite the US subprime mortgage crisis and financial crisis in Europe, economic growth in Indonesia remained relatively high and consistent compared to other countries.
The latest survey of Indonesia’s central bank indicates that consumer confidence fell in December 2014. The central bank’s Consumer Confidence Index fell 3.6 points to 116.5 in the last month of 2014 (a score above 100 signals optimism among consumers) due to the impact of higher subsidized fuel prices implemented in November 2014. This move triggered higher prices of products and services. The central bank’s Consumer Confidence Index is based on interviews with 4,600 households in 18 Indonesian cities.
According to data from ANZ-Roy Morgan, Indonesian consumer confidence increased 3.7 points to hit a record high at 161.4 points in August. Compared to the same month last year, Indonesian consumer confidence has grown by 11.9 points. Improved confidence in August is primarily due to increased confidence in personal finances and consumers’ expectation to buy household appliances. Indonesians are also more optimistic about the condition of the domestic economy in the five years ahead due to the arrival of president-elect Joko Widodo.
The Consumer Confidence Index of Indonesia rose 0.9 percent in September 2013 after having fallen 8.4 percent in the previous month. In September, the index rose because Indonesian consumers are more confident about prospects of the Indonesian economy, while concerns about the increase of certain food prices eased. Purbaya Yudhi Sadewa, chief economist at the Danareksa Research Insititute, said that in September 77.4 percent of consumers were concerned about rising food prices, down from 82.5 percent in August.
Indonesia's main stock index (IHSG) took another large blow on Wednesday (03/07). The index fell 3.20 percent to 4,577.15 points as investors were worried after reading the revised outlook of the World Bank. The institution downgraded its forecast for economic growth in Indonesia in 2013 from 6.2 percent to 5.9 percent. Higher inflation, because of the recent subsidized fuel price hike, is expected to result in lower domestic consumption. The IDR rupiah posted a slight weakening to IDR 9,941.
