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| , 21 January 2018 |
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Q1 Economic Growth Projected at 4.95%
Friday, 21 April, 2017 | 17:06 WIB
Q1 Economic Growth Projected at 4.95%

TEMPO.CO, Jakarta - Bahana Sekuritas projected Indonesia`s economy in the first quarter this year grew 4.95 percent. This projection is lower than the initial prediction of 5.1 percent.

Quarter one's growth is mainly supported by the steady increase of household consumption, investment, as well as exports, that managed to compensate for the low government spending.

China's growing economy is also predicted to boost Indonesia's trade balance.

"By looking at global and domestic economic developments, as well as low domestic and global inflationary pressures, there is no urgent need for BI to tighten monetary policies by the end of this year," economist Fakhrul Fulvian said in a press release on Friday, April 21.

The increasing growth prospects in the global economy and China's will have a positive impact on the domestic economy—triggering capital inflows and allowing rupiah to strengthen to around Rp12,900/US dollar in the second quarter of this year.

However, it should be noted that rising commodity prices in the international markets could have a negative effect on Indonesia's government bonds. Bahana estimated that the yield for the 10-year SUN may drop to 6.7 percent from the current level of 7.1 percent.


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