Indonesia's Q1 Economic Growth Eases More Than Expected
May 05 2020 - 12:11AM
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Indonesia's economic growth eased more than expected in the
first quarter as the coronavirus, or Covid-19, outbreak weighed
heavily on consumption, investment and tourism, official data
showed Tuesday.
Gross domestic product climbed 2.97 percent on a yearly basis in
the first quarter, much slower than the 4.97 percent expansion seen
in the fourth quarter. Economists had forecast the economy to grow
4.04 percent.
Quarter-on-quarter, GDP shrank 2.41 percent in the first
quarter, which was faster than the expected fall of 1.27
percent.
The expenditure-side of GDP showed that household consumption
rose only 2.84 percent annually and government spending advanced
3.74 percent in the first quarter.
Investment rose 1.7 percent and exports gained 0.24 percent.
Meanwhile, imports fell 2.19 percent.
Earlier, the government had downgraded its growth projection for
this year to 2.3 percent and cautioned that the economy could even
shrink in a worst case scenario.
Gareth Leather at Capital Economics said Indonesia was later
than other countries to lockdown its economy, meaning more of the
hit will have fallen in the second quarter. The economist expects a
sharp contraction in the three months to June period.
The monetary policy sidelined for the time being, fiscal policy
will likely be counted on to support the economy, with the second
quarter likely to fall into contraction as Covid-19 cases continue
to rise, despite President Jokowi's partial lockdown measures,
Nicholas Mapa, an ING economist added.
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