Indonesia's Forex Reserves US$123B in February
Bank Indonesia Headquarters at Central Jakarta - Photo: Special
JAKARTA (TheInsiderStories) – Indonesian retail sales slow down in January 2019, indicated by the real sales index which recorded 218.1 or grew 7.2 percent in January 2019, said the central bank today (03/12). This value decreased compared to December 2018 which grew 7.7 percent.
Bank Indonesia (BI) noted that the slowdown in the real sales index also occurred regionally. The real sales index in Surabaya was recorded to decline from 51.7 percent in December 2018 to 51.2 percent in January 2019.
Nonetheless, retail sales will grow in February 2019. The real sales index in February 2019 is expected to reach 10.9 percent, higher than 7.2 percent in January 2019.
The increase in retail sales in February 2019 came from an increase in the performance of sales of clothing commodities, commodities of cultural and recreational goods, each of which rose to 38.8 percent and 26.9 percent from 27.9 percent and 21.5 percent of previous month. Chinese New Year celebrations are a factor in increasing retail sales.
In the next three and six months, price pressures are expected to be lower. This can be seen from the general price expectation index for the next 3 months of 154.3, down from 156.9 in the previous month.
The pressure of rising prices is also expected to decline in July 2019, as indicated by the general price expectation index for the next 6 months of 157.9, down from 168 in the previous month. The fall in pressure from rising prices was due to the normal return of demand after the Eid-Fitr festivities.
While retail sales, in the next 3 and 6 months are expected to decline. This was reflected in the upcoming 3-month sales expectation index of 140.7, down from 141.3 in the previous month.
While, the sales expectation index for the next 6 months was 136.3, lower than 148.8 in the previous month. The decline in retail sales in July 2019 is due to a return to normal sales after the Eid-Fitr.
The increasing or decreasing of retail sales influence Indonesia’ economic growth. Indonesian government eyes a higher economic growth in 2020 compared to this year. Government assumed that Indonesia’ economy will grow in a range of 5.3 to 5.5 percent, higher than the 2019’ target at 5.3 percent.
According to National Development Planning Minister Bambang Brodjonegoro, government desires a higher growth, but there are several medium-term issues need to be fixed. One of the biggest challenges is manufacture sector revitalization supported by high-quality human resources, he said.
Besides, government will continue to focus on infrastructure, especially clean water and electricity. Based on the agency data, infrastructure contribution to Gross Domestic Product (GDP) is considered low at 43 percent, while other countries can be at 70 percent.
Moreover, Indonesia Finance Minister Sri Mulyani Indrawati added, government will put attention on maintaining a more balance economy structure and slashing current account deficit. She said that the meeting also discussed about how to upgrade Indonesia from middle income to upper income country. She expects that it will be detailed in another meeting.
President Joko Widodo was explained that there are four things that will be focused on ahead of 2020. He wants that the macroeconomy and fiscal policy working plan sustainably continues, even though Indonesia’ entering election year.
He said, the government will continue prioritizing human resources. Moreover, he hopes that the 2020’ working plan can anticipate the world’ economy dynamics. And the least, Indonesia’s positive economic growth moment must be maintained.
Written by Staff Editor, Email: theinsiderstories@gmail.com