Analysis by Region - Emerging Markets - Indonesia
Description
We've cut our 2026 GDP growth forecast for Indonesia by 0.2ppts to 5.1% y/y. We expect private consumption to hold up as the government protects consumers from the oil price shock, perhaps at the expense of some public investment. The fiscal deficit should stay close to – but not breach – the 3%-of-GDP cap. We expect Bank Indonesia (BI) to prioritise currency stability, with a single rate cut pencilled in for late Q3, albeit dependent on currency stability.
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