Solid Economic Momentum Maintained in Indonesia - Bank Sentral Republik Indonesia
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February 19, 2019
No. 21/8/DKom
 
Solid economic growth recorded in the final quarter of 2018 points to maintained economic momentum in Indonesia. Actual GDP growth was realised at 5.18% (yoy) in the fourth quarter of 2018, up slightly on the 5.17% (yoy) posted in the previous period. Growth for the year, therefore, increased to 5.17% (yoy) in 2018 from 5.07% (yoy) in 2017, representing the fastest rate recorded in the past five years.
 
Domestic demand was the key driver of economic growth in the final three months of 2018, influenced primarily by household consumption as well as consumption by non-profit institutions serving households (NPISH). Household consumption accelerated from 5.00% (yoy) in the third quarter of 2018 to 5.08% (yoy) in the three months to December on the back of rising incomes, controlled inflation and growing consumer confidence. On the other hand, NPISH consumption increased from 8.59% (yoy) to 10.79% (yoy) over the same period as spending on preparations for the presidential and legislative elections to be contested in 2019 is ramped up. Strong domestic demand also stems from sound investment performance. In contrast, exports declined in 2018 as a corollary of global moderation. By sector, the main driver of growth was the tertiary sector, financial services in particular. Concerning the secondary sector, however, manufacturing grew 4.25% (yoy) in the fourth quarter of 2018, down from 4.35% (yoy) in the previous period.
 
Bank Indonesia is upbeat regarding economic performance in the fourth quarter of 2018. Solid economic growth in the final quarter of the year is indicative of maintained economic momentum in Indonesia. Moving forward, Bank Indonesia remains avowedly committed to maintaining macroeconomic stability as the foundation of sustainable economic growth. Furthermore, Bank Indonesia continues to strengthen policy coordination with the Government in order to sustain economic growth momentum. Therefore, Bank Indonesia projects economic growth for 2019 in the 5.0-5.4% range.
 
Jakarta, 6 February 2019
Communication Department
 
Agusman
Executive Director 
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