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JAKARTA (TheInsiderStories) – Bank Indonesia (BI) viewed that the country’ trade balance remained positive in the first quarter of 2019, amid the lowered import and export, an official stated on Monday (05/06). This situation, BI rated, is in line with the impact of slowing world economic growth and shrinking commodity prices.

Executive Director Bank Indonesia Onny Widjanarko said in a written statement, this can be seen from the performance of the Indonesian economy in the first quarter (1Q) of 2019, which remained positive over the world economic growth.

The economic growth in the 1Q 2019 was recorded at 5.07 percent, it was slowing compared to the 4Q growth of 5.18 percent. This figured only rose 0.01 percentage point compared to the same period in 2018.

Slowing growth, he said, was inseparable from the influence of seasonal patterns in early year and the impact of improving global economic growth, which was lower than forecast.

He stated that economic growth in 1Q 2019 was mainly supported by domestic demand, especially the consumption of Non-Profit Institutions that served households consumption. The growth of consumption of the institutions in 1Q 2019 rose to 16.93 percent from 10.79 percent in 4Q 2018, driven by consumption expenditure related to the 2019 election.

Even though in 1Q 2018, the consumption expenditure was only 8.10 percent from 1Q 2017 only grew 8.08 percent. While, the household consumption growth in 1Q 2019 also remained good at 5.01 percent, although it slowed compared to 4Q 2018 conditions at 5.08 percent.

The better household consumption performance is supported by controlled inflation, as well as private’s incomes and improved levels of consumer confidence, he noted. In addition, domestic demand was also supported by building investment growth which was still high at 1.65 percent.

In the future, he stressed that the central bank’ mix-policy continued to be taken to maintain macroeconomic stability and contribute to economic growth. Bank Indonesia has forecast 2019 economic growth to be in the range of 5.0-5.4 percent.

“The policy mix of Bank Indonesia, the Government and related authorities will always be strengthened to maintain the momentum of economic growth,” he said.

Previously, Board of Governors’ Meeting of BI on April 24-25 decided to maintain a 7-day Reverse Repo Rate (BI7DRR) of 6.0 percent, a Deposit Facility interest rate of 5.25 percent, and a Lending Facility interest rate of 6, 75 percent to strengthen the external stability of the Indonesian economy.

Written by Daniel Deha, Email: daniel@theinsiderstories.com