Macroeconomic Forecast Indonesia

July 2006 | Macroeconomic Forecasts

BMI View: Our forecast for Indonesian growth in 2006 has been lowered from 5.3% to 5.0% in response to poor growth data for Q106. High inflation and interest rates have continued to weigh on consumer confidence, and although inflation will ease as the year progresses, we do not expect it to fall below 15% until October. This means that consumption, which has been Indonesia's main driver of growth since the Asian financial crisis, will remain weak for most of the year. Investment is also likely to slow in 2006, after showing signs of recovery over the past two years. This

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