Indonesia
Indonesia's Official Q3 GDP at 6.2 procent
Indonesia's gross domestic product grew 6.2 percent in the third quarter from a year ago, in line with forecasts, as domestic consumption and investment remained strong despite a deteriorating global economy, government data showed on Monday.
A slowdown in trade saw the annual rate of gross domestic product growth in the G20 economy ease from 6.4 percent in the second quarter, remaining strong by global standards but at the slackest pace nonetheless since the third quarter of 2010. "Q3 GDP matched consensus, signalling some moderation in the momentum, though nothing to be alarmed about as Indonesia is still amongst the fastest growing economies in the region," said Radhika Rao, an economist at Forecast in Singapore.
"Subdued exports performance could emerge as the main soft spot, with the slowdown in imports in recent months to stoke concerns over the sustainability of strong investments cycle." Recent data has pointed to an improvement in demand. Exports fell 9.35 percent year-on-year in September but performed better than a 24 percent slump in August, while a manufacturing index rose to its highest level in 19 months in October due to increasing export orders.
Tame inflation coupled with better-than-expected trade figures suggest Bank Indonesia will leave its benchmark interest rate at a record low 5.75 percent at its Nov. 8 policy meeting and for the rest of the year. "Q3 GDP growth came in within market expectations and is generally supportive of the view that Indonesia's growth prospects are modest going into 2013," said Gundy Cahyadi, an economist from OCBC in Singapore. "We may now see growth coming in at 6.3-6.4 percent year-on-year for the whole of 2012 and maintain our 6.5 percent growth forecast for 2013. The strong investment growth seen earlier this year is likely to mean that the positive trickle down impact on the economy will prevail into next year.
"Bank Indonesia is still unlikely to rush for any rate change for now." The rupiah stood at 9,625 per dollar after the GDP data, while one-month dollar/rupiah non-deliverable forwards were also unchanged at 9,650. Indonesia's benchmark stock index edged lower after the data to trade 0.8 percent down by 0416 GMT.
Indonesia's economy has so far remained resilient in the face of a global slowdown thanks to robust investment and buoyant domestic demand in the world's fourth most populous nation. Healthy third quarter GDP numbers indicate growth for the full year is likely to come in within Bank Indonesia's 2012 target of 6.1-6.5 percent. The continued strength of domestic consumption was highlighted by a 28 percent jump in vehicle sales in September, despite new down payment requirements for auto purchases. Retail sales grew by 11.4 percent in August, down from 20 percent a month earlier. Despite infrastructure constraints and corruption, Indonesia booked a record foreign direct investment of Rp 56.6 trillion Indonesian ($5.88 billion) in the third quarter, up 22 percent from a year ago.