Below is a list with tagged columns and company profiles.

Today's Headlines BI Rate

  • Cement Sales in Indonesia Rise on Infrastructure and Property Projects

    Cement sales in Indonesia surged 21 percent month-to-month (m/m) to 5.6 million ton in September 2014 from 4.6 million ton in the preceding month. Widodo Santoso, Chairman of the Indonesian Cement Association (ASI), said that the increase in Indonesian cement sales was supported by the start of a number of central and regional government infrastructure projects. Santoso also detected an increase in development of property projects. Infrastructure and property are the sectors that absorb most cement.

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  • Higher Interest Rates in 2015 Could Further Limit GDP Growth of Indonesia

    The economy of Indonesia, which has been slowing since 2011, will have difficulty to rebound in 2015 as the central bank’s key interest rate (BI rate) is expected to be raised again to avert capital outflows brought on by higher interest rates in the US and to combat accelerated inflation after domestic subsidized fuel prices have been raised by the new government led by president-elect Joko Widodo (Jokowi). After a GDP growth pace of 6.5 percent (y/y) in 2011, economic growth in Southeast Asia’s largest economy fell to 5.8 percent (y/y) in 2013.

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  • Indonesia Investments' Newsletter of 14 September 2014 Released

    On 14 September 2014, Indonesia Investments released the latest edition of its newsletter. This free newsletter, which is sent to our subscribers once per week, contains the most important news stories from Indonesia that have been reported on our website in the last seven days. Most of the topics involve economic topics such Indonesia’s fuel subsidies, economic growth in 2015, monetary policy of Bank Indonesia, the Anas Urbaningrum corruption case, emerging Indonesian companies on a global scale, and more.

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  • Bank Indonesia’s Dilemma: Reducing or Maintaining the BI Rate at 7.50%?

    There are mixed opinions about the interest rate policy of the central bank of Indonesia (Bank Indonesia). Tomorrow (11/09), at the Board of Governor’s Meeting, the central bank will decide whether or not to change the country’s interest rates. Indonesia’s benchmark interest rate (BI rate) has been held at 7.50 percent for ten consecutive months. This relatively high figure managed to ease high inflation (which emerged after prices of subsidized fuel prices were raised in June 2013). However, it also further slowed economic growth.

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  • Bank Indonesia’s Monetary Policy Tight until Current Account Balance Improves

    The central bank of Indonesia (Bank Indonesia) indicated that it will only loosen its monetary policy provided that the country’s current account deficit narrows to a level of 2.5 percent of gross domestic product (GDP), which is considered sustainable, and inflation is kept within the range of 3.5 to 5.5 percent (year-on-year) in line with the central bank’s target range. The current account deficit is one of the main problems being faced by Southeast Asia’s largest economy today and causes concern among foreign and domestic investors.

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  • Bank Indonesia Expected to Keep Key Interest Rate (BI Rate) at 7.50%

    The central bank of Indonesia (Bank Indonesia, BI) is expected to keep its benchmark interest rate (BI rate) at 7.50 percent at Thursday’s Board of Governors’ Meeting (14/08) as inflation has eased to 4.53 percent (year on year) in July while the country’s current account deficit may nearly double in the second quarter of 2014 to four percent of gross domestic product (GDP) from 2.06 percent of GDP in the previous quarter. Most analysts expect that Bank Indonesia will maintain the current BI rate for the remainder of 2014.

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  • Foreign Banks in Indonesia Post Large Profit on Rupiah Depreciation

    According to data from the Financial Services Authority (OJK), foreign banks operating in Indonesia have posted great profit growth in the January to May 2014 period. Combined, these foreign banks have recorded a 94.36 percentage point growth (year-on-year) in profit to IDR 3.79 trillion (USD $323.9 million) in the first five months of this year. The reason behind this jump in profit is the sharply depreciated rupiah exchange rate. Over the course of 2013, the rupiah fell over 25 percent against the US dollar.

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  • Forecast of Indonesian July Inflation and August Benchmark Interest Rate

    The pace of Indonesian inflation in July 2014 is expected to be in the range of 0.60 to 0.75 percent (month-on-month). If realized, this would be one of the lowest July inflation figures in recent Indonesian history. Traditionally, the month of July brings high inflationary pressures as consumers spend more on food products and other consumer goods as well as transportation amid the holy fasting month of Ramadan and subsequent Idul Fitri celebrations (which also involves the mudik tradition).

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  • Indonesia Investments' Newsletter of 13 July 2014 Released

    Indonesia Investments' Newsletter of 13 July 2014 Released

    On 13 July 2014, Indonesia Investments released the latest edition of its newsletter. This free newsletter, which is sent to our subscribers once per week, contains the most important news stories from Indonesia that have been reported on our website in the last seven days. Most of the topics involve political and economic topics such as the presidential election, an analysis of the interest rate environment, car sales, IPOs on the Indonesia Stock Exchange, a tender announcement, and more.

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  • After Unofficial Jokowi Win, Euphoria on Indonesian Markets Starts to Wane

    After a trading week that was characterized by high gains in the stock and financial markets on optimism that Joko Widodo (Jokowi) will become the next president of Indonesia, both the Indonesian rupiah exchange rate and benchmark Jakarta Composite Index fell today (11/07). This seems an obvious sign that the euphoria about a Jokowi win has waned and investors are looking again to the true economic fundamentals of Southeast Asia’s largest economy. By 13:00 pm local Jakarta time, the Jakarta Composite Index had fallen 1.66 percent.

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Latest Columns BI Rate

  • ICRA Indonesia’s Economic Review; an Update on the Macroeconomy

    ICRA Indonesia’s Economic Review; an Update on the Macroeconomy

    ICRA Indonesia, an independent credit rating agency and subsidiary of ICRA Ltd. (associate of Moody's Investors Service), publishes a monthly newsletter which provides an update on the financial and economic developments in Indonesia of the last month. In the February 2014 edition, a number of important topics that are monitored include Indonesia's inflation rate, the trade balance, the current account deficit, the IDR rupiah exchange rate, and gross domestic product (GDP) growth. Below is an excerpt of the newsletter:

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  • Indonesia's Stock Index Down 0.10% But Rupiah Strengthens Sharply

    The weakening Dow Jones Index on Wednesday (12/02) caused negative market sentiments in Asia the following day. Most Asian indices, including Indonesia's Jakarta Composite Index (IHSG), were down. Not even the announcement that Bank Indonesia decided to maintain its benchmark interest rate (BI rate) at 7.50 percent was able to push the IHSG back in the green zone. Investors probably already anticipated the central bank's decision as it was in line with the market's expectation.

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  • Official Press Release of Bank Indonesia: BI Rate Kept at 7.50%

    Official Press Release of Bank Indonesia: BI Rate Kept at 7.50%

    At Bank Indonesia's Board of Governors’ Meeting today (13/02), it was decided to maintain the country's benchmark interest rate (BI rate) at 7.50 percent as well as the interest rates on the Lending Facility and Deposit Facility at 7.50 percent and 5.75 percent respectively. The policy is consistent with the tight monetary policy stance currently adopted in order to steer inflation back towards its target corridor of 4.5±1 percent in 2014 and 4±1 percent in 2015, as well as to reduce the current account deficit to a more sustainable level.

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  • Motorcycle Sales in Indonesia Fall 11% in January 2014 due to Floods

    Motorcycle Sales in Indonesia Fall 11% in January 2014 due to Floods

    Domestic sales of motorcycles in Indonesia fell 11 percent to 580,288 units in January 2014. The main reason for this decline in the first month of the year were severe floods brought about by high rainfall amid a peak of the rainy season. These weather conditions disrupted the distribution of motorcycles from factories to dealers. As a result, all motorcycle brands recorded lower sales figures according to data released by the Indonesian Motorcycle Industry Association (Aisi). However, more factors were at play.

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  • ICRA Indonesia’s Economic Review; an Update on the Macroeconomy

    ICRA Indonesia, an independent credit rating agency and subsidiary of ICRA Ltd. (associate of Moody's Investors Service), publishes a monthly newsletter which provides an update on the financial and economic developments in Indonesia of the last month. In the January 2014 edition, a number of important topics that are monitored include Indonesia's inflation rate, the trade balance, the current account deficit, the IDR rupiah exchange rate, and gross domestic product (GDP) growth. Below is an excerpt of the newsletter:

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  • Car Sales in Indonesia Unaffected by Weather Conditions in January 2014

    Car Sales in Indonesia Unaffected by Weather Conditions in January 2014

    Despite higher car prices due to the depreciating rupiah exchange rate, domestic car sales in Indonesia rose 11 percent to 107,496 in January 2014 compared to the same month last year. January sales were particularly supported by sales of the low cost green car (LCGC) and low multipurpose vehicle (LMPV). Both these car types enjoy high popularity in Indonesia. In 2013, the Indonesian government provided tax incentives for the establishment of a domestic LCGC industry.

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  • Inflation Update January 2014: Analysis of Indonesia's 1.07% of Inflation

    Inflation Update January 2014: Analysis of Indonesia's 1.07% of Inflation

    The pace of Indonesia's monthly January inflation rate was higher in 2014 than in the same month during the past five years. This relatively high inflation rate this year, recorded at 1.07 percent, was caused by severe rainfall and floods in several parts of Indonesia (particularly in the cities of Jakarta and Manado) amid the peak of the rainy season. These weather-related circumstances impacted on prices of food products as distribution channels were disrupted, thus giving rise to increasing prices. Annual inflation, however, slightly eased.

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  • Indonesia's Chamber of Commerce: Economic Growth Will Slow in 2014

    Indonesia's Chamber of Commerce: Economy Will Slow in 2014

    This year, legislative and presidential elections will be held in Indonesia. Obviously, there is a strong relationship between the politics and economics of a country. Businessmen from various sectors of Indonesia's economy have already been voicing their views. As the umbrella organization of the Indonesian business chambers and associations, Kadin Indonesia recently shared its views about the elections as well. The institute believes that the 2014 elections will run smoothly because Indonesia's democracy has matured.

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  • Analysis: What Caused Indonesia's Slowing Economic Growth in 2013

    Analysis: What Caused Indonesia's Slowing Economic Growth in 2013

    On Wednesday 5 February 2014, Statistics Indonesia (BPS, a non-departmental government institute) is expected to release Indonesia's official GDP growth figure for the year 2013. It is estimated that the outcome will be the lowest GDP growth figure since 2009 when Southeast Asia's largest economy grew 4.6 percent after feeling the impact of the global financial crisis. In 2013, again, Indonesia felt the negative influence of external troubles. And in combination with domestic factors, Indonesia's economic growth is expected to be around 5.7 percent in 2013.

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  • Analysis of Indonesia's Rupiah Rate: Improvement in Second Half 2014?

    Analysis of Indonesia's Rupiah Exchange Rate: Improvement in Second Half 2014?

    In the Bloomberg Dollar Index, Indonesia's rupiah exchange rate depreciated 0.47 percent to IDR 12,238 per US dollar on Monday (27/01). The decline of the rupiah was in line with today's trend of weakening Asia Pacific currencies (against the US dollar). Meanwhile, the central bank's mid rate (the Jakarta Interbank Spot Dollar Rate or JISDOR) depreciated 0.17 percent to IDR 12,198 per US dollar. Market participants are concerned about Indonesia's January 2014 inflation and further Federal Reserve tapering.

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