World Bank2017-05-172017-05-172012-10https://hdl.handle.net/10986/26645The Indonesia economic quarterly reports on and synthesizes the past three months' key developments in Indonesia's economy. It places them in a longer-term and global context, and assesses the implications of these developments and other changes in policy for the outlook for Indonesia's economic and social welfare. Indonesia's economic growth has so far remained resilient to the weakness in the global economy. Amidst a still uncertain outlook, Indonesia will need to prepare itself for the potential consequences of China's slowdown and additional falls in commodity prices, and for the possibility of renewed turbulence in financial and commodity markets. Continuing to strengthen the policy framework to deal with shocks and building economic resilience through improvements in the quality of spending and in the regulatory environment will be key to maintaining, and improving further, Indonesia's strong recent growth performance. Progress towards these goals could be tested as the 2014 election year approaches. Indonesia's economy maintained its robust pace of growth in the second quarter of 2012, expanding by 6.4 percent year-on-year, up slightly from 6.3 percent in the first quarter. Buoyant private consumption continued to lift domestic demand, and investment spending also increased strongly. Despite the rapid pace of economic activity, consumer price inflation has remained moderate to date. Headline CPI inflation fell back to 4.3 percent year-on-year in September after edging up to 4.6 percent in August, when it was pulled higher temporarily by the Idul Fitri holidays. Core inflation has remained stable, just above 4 percent. Indonesia's current account moved further into deficit in the second quarter of 2012. Structurally, the trend towards current account deficits reflects consistently strong domestic investment relative to the level of domestic savings. The slowdown in exports over 2012, alongside generally strong import demand, has seen the large goods trade balance surpluses of recent years narrow and this, coupled with consistent net outflows in the income and services sub-accounts, moved the overall current account into a deficit of 3.1 percent of gross domestic product (GDP) in the second quarter of 2012.en-USCC BY 3.0 IGOACCOUNTINGADVERSE SHOCKSASSET PRICEBALANCE OF PAYMENTBALANCE SHEETSBANK SUPERVISIONBANKING SECTORBASIS POINTSBENCHMARK YIELDBENEFICIARIESBILLBOND INDEXBOND ISSUEBOND MARKETBOND PRICESBONDSBUDGET DEFICITCAPITAL ADEQUACYCAPITAL FLOWSCAPITAL FORMATIONCAPITAL GOODSCAPITAL GOODS IMPORTSCAPITAL INFLOWSCAPITAL INVESTMENTCAPITAL MARKETSCAPITAL STOCKCASH BALANCESCASH TRANSFERCENTRAL BANKCLARITYCOMMERCIAL BANKCOMMERCIAL BANK LENDINGCOMMODITY MARKETCOMMODITY PRICECOMPETITIVENESSCONSENSUS FORECASTSCONSUMER CREDITCONSUMER PRICE INDEXCONSUMER PRICE INFLATIONCONSUMPTION EXPENDITURECONSUMPTION GROWTHCORE INFLATIONCORPORATE BONDCORPORATE BOND ISSUANCECREDIT GROWTHCREDIT QUALITYCURRENCY DEPRECIATIONCURRENT ACCOUNTCURRENT ACCOUNT BALANCECURRENT ACCOUNT DEFICITDEBT SECURITIESDEBT STOCKDEFICIT FINANCINGDEFICITSDEPOSITSDEVELOPING COUNTRYDISBURSEMENTDISTORTIONSDOMESTIC CAPITALDOMESTIC DEMANDDOMESTIC DEMAND GROWTHDOMESTIC ECONOMYDOMESTIC SAVINGSDOWNSIDE SCENARIOSDOWNWARD PRESSUREDRAG ON GROWTHECONOMIC CONDITIONSECONOMIC DEVELOPMENTECONOMIC GROWTHEMERGING ECONOMIESEMERGING MARKETEMERGING MARKET BONDEMERGING MARKET DEBTEMERGING MARKET ECONOMIESEMERGING MARKET EQUITIESEQUIPMENTEQUITIESEQUITY HOLDINGSEQUITY INDEXEQUITY MARKETSEXCHANGE RATEEXPENDITURESEXPORT EARNINGSEXPORT GROWTHEXPORT PERFORMANCEEXPORT SHAREEXPORTERSEXTERNAL BALANCESEXTERNAL BORROWINGEXTERNAL DEBTEXTERNAL DEMANDFEDERAL RESERVEFINANCIAL ASSETFINANCIAL CRISISFINANCIAL INSTITUTIONFINANCIAL MARKETFINANCIAL MARKET PARTICIPANTSFISCAL DEFICITFISCAL POLICYFISCAL POSITIONFIXED CAPITALFOREIGN DIRECT INVESTMENTFOREIGN EXCHANGEFOREIGN EXCHANGE MARKETFOREIGN INVESTMENTGLOBAL BONDGLOBAL DEMANDGLOBAL ECONOMYGLOBAL SLOWDOWNGOVERNMENT BONDGOVERNMENT BOND YIELDGOVERNMENT DEBTGOVERNMENT FINANCINGGOVERNMENT INVESTMENTGOVERNMENT SECURITIESGOVERNMENT SECURITIES MARKETGOVERNMENT SPENDINGGROSS DOMESTIC PRODUCTGROWTH PERFORMANCEGROWTH RATESHOLDINGIMPORTIMPORT DEMANDIMPORT GROWTHIMPORT PRICESINCOME TAXINFLATIONINFLATION RATEINFLATIONARY PRESSURESINSURANCEINTEREST PAYMENTSINTERNATIONAL BANKINTERNATIONAL FINANCIAL MARKETSINTERNATIONAL MARKETINTERNATIONAL PORTFOLIOINVENTORYINVESTMENT DEMANDINVESTMENT FLOWSINVESTMENT INFLOWSINVESTMENT LEVELSINVESTMENT LOANSINVESTMENT POLICYINVESTMENT RATIOINVESTMENT REGULATIONINVESTMENT SPENDINGINVESTOR CONFIDENCELIQUIDITYLIQUIDITY MANAGEMENTLOANLOCAL CURRENCYLOCAL GOVERNMENTMARKET CONDITIONSMONETARY EXPANSIONMONETARY POLICYMONETARY TRANSACTIONSNON-PERFORMING LOANSOIL PRICEOPPORTUNITY COSTPOLICY RESPONSEPOLITICAL UNCERTAINTYPORTFOLIOPORTFOLIO CAPITALPORTFOLIO INFLOWSPORTFOLIO INVESTMENTPRICE INDICESPRICE MOVEMENTSPRIVATE CONSUMPTIONPRIVATE DEBTPUBLIC INVESTMENTPUBLIC SPENDINGRAPID GROWTHREAL EXPORTSRECESSIONRESERVESRETURNRETURN ON ASSETSSECONDARY MARKETSLOWDOWNSOVEREIGN BONDSOVEREIGN BOND MARKETSSTRUCTURAL REFORMSSUPPLY-SIDESURPLUSSUSTAINABLE GROWTH RATETAXTOTAL INVESTMENTTRADE BALANCETRADE DATATRADE SURPLUSTRADINGTRADING PARTNERTRADING PARTNERSTREASURIESTREASURYUNCERTAINTIESUNEMPLOYMENT RATEWORKING CAPITALReportWorld Bank10.1596/26645