Jl.MH. Thamrin No.2 Jakarta Indonesia
|
|
- Christopher Barber
- 6 years ago
- Views:
Transcription
1 Jl.MH. Thamrin No.2 Jakarta Indonesia
2 BANK INDONESIA For further information. please contact: Economic Outlook & Policy Dissemination Bureau of Monetary Policy Directorate of Economic Research and Monetary Policy Telephone : Fax. : BKM_TOD@bi.go.id Website :
3 MONETARY POLICY REPORT Bank Indonesia monetary policy report QUARTER I-2010 The Monetary Policy Report is published quarterly by Bank Indonesia after the Board of Governors Meetings in January. April. July. and October. In addition to fulfilling the mandate of article 58 of Act Number 23 of 1999 concerning Bank Indonesia. amended by Act No. 3 of the report has two main purposes: (i) to function as a tangible product of a forward-looking working framework in which formulation of monetary policy is based on economic and inflation forecasts; and (ii) as a medium for the Board of Governors of Bank Indonesia to present to the public the various policy considerations underlying its monetary policy decisions. The Board of Governors Darmin Nasution Hartadi A. Sarwono Siti Ch. Fadjrijah Senior Deputy Governor Deputy Governor Deputy Governor S. Budi Rochadi Deputy Governor Muliaman D. Hadad Ardhayadi Mitroatmodjo Budi Mulya Deputy Governor Deputy Governor Deputy Governor i
4 ii MONETARY POLICY REPORT Bank Indonesia
5 MONETARY POLICY REPORT Bank Indonesia Enhanced Monetary Policy Measures Under Inflation Targeting Framework In July Bank Indonesia implemented and enhanced monetary policy measures within the Inflation Targeting Framework (ITF) which encompasses four main areas: the use of the BI rate as an operational target. enhanced decision making process. more transparent communications strategy. and strengthened policy coordination with the Government. The measures is intended to strengthen the effectiveness and to provide good governance to its monetary policy making to achieve the price stability needed to support suistainable economic growth and attain social welfare. Underlying Principles Monetary Policy Strategy Under the ITF. the inflation target is established as the overriding objective and nominal anchor for monetary policy. In this regard. Bank Indonesia has adopted a forward looking strategy by guiding the present monetary policy response for achievement of a medium-term inflation target. The application of the ITF does not mean that monetary policy disregards economic growth. The basic monetary policy paradigm of striking the optimum balance between inflation and economic growth is retained in both setting the inflation target and in the monetary policy response by focusing on achievement of low. stable inflation in the medium to long-term. The Inflation Target Government upon coordination with Bank Indonesia has set and announce an inflation target of CPI every year. Based on KMK No.1/KMK.011/2008, the inflation targets established by the Government for are 5.0%, 4.5% and 4.0% with ±1% deviation. However, based on the latest developments, Bank Indonesia has proposed new inflation target to the government. The proposed inflation target for are 5% ± 1%, 5% ± 1%, and 4.5% ± 1% respectively. Monetary Instruments and Operations The BI Rate is the published policy rate reflecting the monetary policy stance adopted by Bank Indonesia. The BI Rate is a signal for achieving the medium to long-term inflation target and is announced periodically by Bank Indonesia for a specific period. To strengthen the operational framework for monetary policy. Bank Indonesia changed from use of the 1-month SBI rate as the operational target to the overnight interbank rate with effect from 9 June In monetary operations. the BI Rate is implemented through liquidity management on the money market to achieve the monetary policy operational target. reflected in movement in the overnight interbank money market rate. To enhance the effectiveness of liquidity management on the market. a set of standing facilities in combination with an interest rate corridor is employed in day-to-day monetary operations. Policymaking Process The BI Rate is determined by the Board of Governors in the Monthly Board of Governors Meeting. In unforeseen circumstances. the monetary policy stance may be adjusted in advance of the Monthly Board of Governors Meeting in a weekly Board of Governors Meeting. Changes in the BI Rate essentially depict the Bank Indonesia monetary policy response for guiding the forecasted level of inflation within the limits of the established inflation target. Transparency Monetary policy is regularly communicated to the public through customary media for communication. such as statements to the press and market actors. website postings and publication of the Monetary Policy Report (MPR). This transparency is aimed at building improved understanding and shaping public expectations of the economic and inflation outlook and the monetary response taken by Bank Indonesia. Coordination with the Government For the purpose of coordination in inflation targeting. monitoring and control. the Government and Bank Indonesia have established a team of officials representing the various relevant agencies. The task of the Team is to deliberate and recommend the necessary policy actions for the Government and Bank Indonesia in managing inflationary pressures for achievement of the established inflation target. Steps for Reinforcing Monetary Policy with the Overriding Objective of Price Stability (Inflation Targeting Framework) In July Bank Indonesia launched a reinforced monetary policy framework consistent with the Inflation Targeting Framework (ITF). encompassing four key elements: (1) use of the BI Rate as the policy reference rate. (2) anticipatory monetary policymaking process. (3) more transparent communications strategy and (4) closer policy coordination with the Government. These measures are intended to strengthen monetary policy effectiveness and governance in order to achieve the overriding objective of price stability in support of sustainable economic growth and greater public prosperity. iii
6 iv MONETARY POLICY REPORT Bank Indonesia
7 MONETARY POLICY REPORT Bank Indonesia Contents Monetary Policy Report - Quarter III-2009 Contents 1. General Review Latest Macroeconomic Indicators... 5 Deveopments In The World Economy... 5 Economic Growth... 7 Balance of Payments Monetary Indicators and Policy, Quarter I Rupiah Exchange Rate Inflation Monetary Policy Outlook for the Indonesian Economy Assumptions and Scenarios Economic Growth Outlook Inflation Forecast Risk Monetary Policy Response, QI Statistics ix
8 MONETARY POLICY REPORT Bank Indonesia Monetary Policy Report - Quarter III-2009 Contents x
9 General Review 1. General Review The domestic economy is forging ahead with support from the buoyant performance of the global economy. Economic activity in Indonesia showed significant improvement during Q4/2009. Quarterly growth in the economy reached an estimated 5.4% (yoy), bringing growth for 2009 overall to 4.5% (yoy). Conditions in the economy, marked by growing optimism, support a more upbeat outlook compared to earlier forecasts. In 2010, the Indonesian economy is predicted to grow in the range of 5.5%-6.0% and in 2011 at 6.0%-6.5%. Price stability remains in safe territory, as reflected in the subdued movement in the CPI during Q1/2010. This is consistent with the prediction of no significant inflationary pressure arising at least during the first half of For the year as a whole, CPI inflation will come within the 5%±1% targeted range. In the view of Bank Indonesia, the global economy is in recovery and gathering momentum. Advanced economies, led by the US and Japan, are showing steady improvement. Similarly, economic recovery in non-japan Asia, most importantly China and India, is forging ahead. In other developments, signs are emerging of improvement in European economies, albeit on a limited scale. The resolution of the Greece crisis has so far met with positive response among economic actors, with impact limited to financial markets. The recovery in the global economy coupled with improved perceptions of risk has fuelled optimism on financial and commodity markets. Reflecting this are gains in global stock indices and an upward trend in international market commodity prices. Foreign capital flows continued to pour into emerging markets in keeping with improving risk perceptions, a condition that has bolstered currency appreciation in the region. Rising optimism over the global economic recovery and strengthening of global demand spurred price increases across a range of commodities. The price increases alongside appreciation in the currency have not so far triggered any significant rise in global inflation, particularly in advanced nations. With the world economy not yet fully recovered to normal, monetary authorities in developed nations in particular have leaned towards an accommodative monetary policy stance. Signals of monetary tightening are more evident on emerging markets due to rising inflationary pressures fuelled by high rates of economic expansion. Domestic economic performance in Q1/2010 could potentially surpass earlier forecasts. During Q1/2010, the domestic economy charted an estimated 5.7% growth (yoy). This performance was bolstered by the following factors. First, stronger export performance is forecasted in keeping with the improvement in the global economy and rising international commodity prices. Second, consumption is predicted to remain strong, bolstered by safe levels of public purchasing power and consumer expectations. Third, in keeping with rising exports and household consumption, stronger recovery in investment is forecasted with support from various Government actions to fast-track infrastructure projects. Added to this, the improved investment climate in 2010 is also supported by the S&P decision to raise Indonesia s sovereign credit rating from BB- to BB. With this rating upgrade, Indonesia is now just 1 notch below investment grade. Fourth, in line with more 1
10 Monetary Policy Report - Quarter I-2010 robust external side performance, more vigorous growth is forecasted for some sectors, most importantly manufacturing and trade. Manufacturing growth has picked up in response to stronger performance in export-oriented manufacturing and the automotive industry. At the same time, more vigorous trade sector growth is consistent with mounting activity in exports and imports and stronger manufacturing performance. Nevertheless, various issues remain that pose challenges to higher growth, particularly in regard to measures to accelerate infrastructure programmes and make optimum use of opportunities from the launching of the ASEAN-China Free Trade Agreement (AC-FTA). The strengthening of the economy is also visible in the steady improvement in economic performance at the regional level. Economic performance in the regions was led by Sumatra, Kalimantan, Sulawesi, Maluku and Papua (Kali-Sulampua) and Jakarta. Other regions (Java, Bali and Nusa Tenggara or Jabalnustra), however, reported slowing economic activity. Buoyant economic performance in the regions is driven by higher exports, investments and consumption. Export performance in individual regions has risen on higher exports of mainstay commodities, such as mining products and CPI in Sumatra and Kali-Sulampua and chemicals in the Jabalnustra region. In analysis by major export destinations, exports from individual regions have shifted from Japan, America and Europe as in the past to ASEAN and China, due to the more advanced recovery in these economies. Sumatra and Kali-Sulampua have even increased their share of exports to India, particularly for CPO and coal. Indications point to strengthening investment in line with the mounting pace of economic activity. Reflecting this is the positive growth in the indicators for cement consumption growth and capital goods imports. In the area of Regional Government investment, increases have been made in capital expenditures. The higher investment has been channelled mainly into infrastructure projects, such as construction of roads, dams, bridges and airports. In analysis by business category, the industry sector has picked up in response to improving domestic and external demand. More robust industry performance is reflected in production capacity expansion and higher raw materials imports in all regions. In the mining sector, performance has climbed largely from increased production of non-oil and gas mining products led by coal and copper. In contrast, oil and natural gas production continues on a slowing trend. Concerning prices, inflation remained at modest levels in Q1/2010. Low inflationary pressure in Q1/2010 was indicated by March 2010 deflation at 0.14% (mtm), bringing annual CPI inflation to 3.43% (yoy). The success in curbing inflation at this low level is partly attributable to the appreciation in the rupiah and adequate levels of supply in responding to increased demand. Besides this, the low inflation in March 2010 also resulted from a moderation of inflationary pressures from volatile foods (mainly rice), due to the onset of the harvest season in some regions, and minimum inflationary pressure from administered prices. The balance of payments maintained an estimated solid position in Q1/2010, supported by recovery in the world economy. Projections point to a current account surplus, consistent with the steady improvement in exports, particularly of resource-based commodities including coal and copper. Conversely, imports have also climbed in response to more robust domestic and export demand. The capital and financial account similarly recorded 2
11 General Review an estimated Q1/2010 surplus on the strength of capital inflows and issuance of government foreign currency bonds. Risk indicators for Indonesia have improved, as reflected in the alltime low in the credit default swap (CDS) indicator for Indonesia, narrowing yield spread for Indonesia Government Bonds over US Treasury Notes and the upgrading of Indonesia s rating. Taken together, international reserves at end-march 2010 stood at 71.8 billion US dollars, equivalent to 5.8 months of imports and servicing of official external debt. The solid performance in the balance of payments underpinned an appreciating trend in the rupiah. Measured as an average for Q1/2010, the rupiah appreciated by an overall 2.2% to Rp 9,254/USD. At end Q1/2010, the rupiah stood at Rp 9,090/USD, having gained 3.7% (point to point). The strengthening of the rupiah was supported by conducive conditions in macroeconomic fundamentals, reflected in healthy performance in the balance of payments and improving risk perceptions. Other support for rupiah appreciation came from the continued attractiveness of returns on rupiah placements, reflected in uncovered parity (UIP), covered interest parity (CIP) and the relatively high yield spread on Indonesia Government Bonds surpassing yields in other countries in the region. The appreciation in the rupiah was also accompanied by stable level of exchange rate volatility at 0.57% compared to the Q4/2009 level of 0.56%. Financial sector performance has picked up in line with the recovery in the global and domestic economy. The JSX Composite Index mounted significantly in Q1/2010 with gains at 10.2%. This index performance was the highest for any country in the region. Factors driving the JSX Composite gains include the brightening outlook for the Indonesian economy, and with it, reduced perceptions of risk, improvement in the credit rating and high returns on rupiah placements. Also reflecting this was movement in other financial indicators, such as declining yield on government securities. Considerable excess liquidity remains on the interbank money market, which has pushed the overnight interbank rate closer to the lower BI Rate corridor. The Bank Indonesia decision to lengthen the maturities of SBIs for reasons including financial deepening proved successful, as indicated by the narrowing of the high-low interest rate spread on the overnight interbank market. Added to this, the proportion of SBIs in the 3-month tenor soared to 67.0$ from 24.64% at the end of the preceding quarter. Consistent with the diminishing perceptions of bank risks, deposit and lending rates saw further decline although less than expected. Looking forward, monetary policy transmission is predicted to improve in line with strengthening optimism of the banking system in the condition of the economy. At the micro level, conditions in the national banking system remain stable. Reflecting this is the still comfortable level of the capital adequacy ratio (CAR) at 19.3% in February. Similarly, the gross non-performing loans (NPLs) ratio remains below 4% with the net ratio at 1%. Besides this, banking liquidity improved further, including liquidity on the interbank money market. Bank depositor funds similarly recorded growth. The improvements in the global and domestic economy during Q1/2010 are forecasted to carry forward into the future. This reinforces the confidence of Bank Indonesia in a more robust outlook for the Indonesian economy compared to earlier 3
12 Monetary Policy Report - Quarter I-2010 forecasts. Economic growth in 2010 is predicted in the 5.0%-6.0% range, up from the originally projected 5.0%-5.5%. The economy improved not only from the continued strength of consumption, but also higher exports in line with the global economic recovery. Rising demand accompanied by improvement in the investment climate is expected to drive significant growth in investment. The improvement in the economy is forecasted to carry forward into 2011 with growth possibly reaching 6.0%-6.5%. Rising demand matched by capacity for supply-side response is expected to keep future inflationary pressures at a modest level. A complete elaboration of the medium-term outlook for the economy is presented the Indonesian Economic Review 2009, accessible on the Bank Indonesia website. On 6 April 2010, the Bank Indonesia Board of Governors decided to maintain the BI Rate at 6.5% with an interest rate corridor at +/- 50 bps around the BI Rate. Key to this decision was the assessment that the 6.5% level in the BI Rate remains consistent with achievement of the 5%+1% inflation target for The present monetary policy stance is also regarded conducive to the economic recovery process and operation of the bank intermediation function. 4
13 Latest Macroe conomic Indicators 2. Latest Macroeconomic Indicators The continuing process of global economic recovery has also provided a boost to domestic economic performance. During Q1/2010, the increasingly broad-based global economic recovery was supported by solid economic performance in Asia with positive impact on the domestic economy. The better than forecasted growth in Q1/2010 came in response to strengthening of exports and also received support from indications of rising investment. More robust demand in trading partner nations coupled with high commodity prices boosted export performance. In a similar vein, business optimism for improvement economic conditions, improvements in the domestic investment climate and plans for governmentsponsored infrastructure projects strengthened investment performance. Household consumption maintained an upward trend, bolstered by strong public purchasing power and buoyant consumer optimism. On the supply side, rising exports and imports are expected to strengthen performance in the manufacturing and trade, hotels and restaurants sectors. Growing export demand will generate a positive contribution for manufacturing, while higher exports will bring greater activity to the trade, hotels and restaurants sector. On the other hand, agriculture is expected to show reduced growth in Q1/2010, mainly due to the shift in the harvest season to early Q2/2010. Other sectors expected to see brisk growth are the electricity, gas and water utilities sector, primarily from the continuation of the kerosene conversion programme in some regions and commissioning of several powerplants in the Phase I 10,000MW project, and the transport and communications sector due to market penetration of the telecommunications business. DEVELOPMENTS IN THE WORLD ECONOMY Estimates point to added momentum in global economic recovery in Q1/2010. Emerging markets, led by Asia, again provided the driving force accelerating the improvement in the world economy. Developed economies are also predicted to chart positive growth despite the twin challenges of high unemployment levels and tight lending. However, recovery in the European Union lags somewhat due to the fiscal crisis in countries such as Greece and weakness of consumption indicators. Production in advanced economies is on a solid growth track due to the success of the fiscal stimulus in boosting industry activity, a development supported by low inventory levels. In developing nations, solid domestic demand in China is driving the strong demand for imports from Asia with a spillover effect on growth in other economies in the Asian region. In Q4/2009, the US economy reported solid growth on the back of strengthening activity in industry. The fiscal stimulus launched by the US government succeeded in boosting production, which also benefited from decline in inventory levels. The US economy reported Q4/2009 growth at 5.6% (qtq, annualised), with positive year-on-year growth at -0.1%. As a result, the US economy is expected to chart positive growth for Q1/2010. The latest information suggests a renewed surge in consumption in the US as worker lay-offs are brought under control. Stronger household consumption is reflected in steady growth in retail sales 5
14 Monetary Policy Report - Quarter I-2010 for 4 months in a row. An added factor in the rising consumption is the slowing rate of worker lay-offs and a levelling off in the unemployment rate, now at 9.7%. The conducive condition of the labour market is reflected in the decline in average initial jobless claims in Q1/2010 to 467 thousand from 500 thousand one quarter earlier. In further developments, negative growth in payroll figures is progressively easing. The production side in the US is gathering force with indications of entering an expansionary phase. The US government fiscal stimulus through infrastructure projects has given added impetus to US production. On the other hand, mounting retail sales have resulted in drawing down of inventories, with business responding by increasing production as reflected in the rising purchasing manager index (PMI) and industrial production index. Global financial market performance resumed an upward trend after a downturn halfway through the quarter, triggered by uncertainties over resolution of the fiscal crisis in Europe. Reflecting the growing investor optimism in the global financial market were the gains on stock markets in advanced economies during Q1/2010. Despite this, stock markets tumbled briefly on reports of burgeoning fiscal deficits in the GIPSY nations (Greece, Ireland, Portugal, Spain and Italy) and lack of clear resolution to this problem. Near the end of Q1/2010, investor risk appetite rebounded after announcement of a solution to fund the Greek fiscal deficit involving the European Union and IMF. Global markets also picked up after the release of data pointing to steady improvement in global economic fundamental and corporate financial statements consistent with forecasts. In Asia, economic recovery progressed rapidly during Q4/2009, with growth back in positive territory. In most Asian economies, growth has rebounded following the steep decline in the first half of Externally oriented countries in Asia saw significant improvement in line with robust demand for exports to China and India. Added to this was the escalating trend in domestic demand buoyed by positive wealth assets in line with rising housing and stock market prices in Asia and prolonged low interest rates. At the same time, other Asian economies more reliant on domestic demand have maintained positive trends. Looking forward, the economies of China and India remain in the forefront as the economic powerhouses of Asia. Estimated growth in China and India during Q1/2010 is 11.1% (yoy) and 7.9% (yoy). World inflationary pressures during Q1/2010 were comparatively mild. According to composite data on inflation outcomes, world inflationary pressure held at a relatively stable level compared to the preceding quarter. World inflation in March 2010 was recorded at 3.1% (yoy), unchanged from one quarter earlier. Indications suggest that the mounting level of international commodity prices has not escalated inflationary pressure, given the lack of full recovery in world economic activity. Monetary policy remained accommodative despite initial signs of tightening on some emerging markets. In Q1/2010, most major central banks, such as the Fed, BoJ and ECB, kept a lid on interest rates in order to promote domestic economic recovery. The Fed decided to hold its rate in the 0%-0.25% range due to high unemployment and still modest forecast for inflation. Similarly, the ECB held its rate at 1.0% to create a conducive climate for resolution 6
15 Latest Macroe conomic Indicators of the Greek fiscal deficit crisis. In other actions, the BoJ expanded its 3-month loan facility to 20 trillion yen (222 billion US dollars), double the previous level, to stimulate inflation in the medium term, even though interest rates have been held at a very low 0.1%. Some central banks in Asia s emerging markets and central banks in advanced nations have embarked on monetary tightening. Signs of monetary tightening were clearly evident in China and India, which raised their minimum statutory reserve requirements by 100 bps and 75 bps during Q1/2010. Some of Asia s central banks, including Malaysia and India, have already raised their policy rates. Central banks in developed nations such as Australia and Israel have also raised their reference rates in response to growing inflationary pressure while their economies have already charted expansion. Graph 2.1 GDP Leading Indicator ECONOMIC GROWTH Aggregate Demand Economic growth mounted higher in the estimates for Q1/2010. The sharp rise in exports and persistently strong levels of household consumption have brought continued improvement in economic growth. GDP growth in Q1/2010 is estimated ahead of the previous quarter at 5.7% (yoy). Key to this are the gains evident in leading indicators for the GDP (Graph 2.1). GDP growth is estimated higher on the back of strengthening exports and household consumption (Table 2.1). Exports showed improved growth in line with renewed activity in the global economy and high international commodity prices. Imports are also estimated higher in response to mounting external demand for manufactured goods. With export showing stronger performance, both government and private sector investment are expected to climb. At the same time, consumption maintained an upward track, despite slower growth in preliminary figures for Q1/2010. This is explained more by the base effect factor from the preceding year, when consumption soared around the time of the parliamentary elections. Table 2.1 Economic Growth - Demand Side % Y-o-Y, Base Year 2000 * Bank Indonesia Projection I t e m 2007 Table I II III IV I II III IV I* Economic Growth Demand Side Total Consumption Private Consumption Government Consumption Gross Fixed Capital Formation Household consumption in Q1/2010 is estimated to have maintained positive expansion. Export Good and Services Import Good and Services Confirmation of this is visible in the steady improvement in leading indicators for household GDP
16 Monetary Policy Report - Quarter I-2010 consumption (Graph 2.2). Growth in household consumption was supported by adequately robust levels of public purchasing power. The average 8.8% (yoy) increase in Provincial Minimum Wage levels in early 2010, followed by the 5% raise for civil servants, military and police, was one factor bolstering public purchasing power. The generally stable level of farmer terms of trade and labour wages in February 2010 is one indicator of the buoyant private incomes. Alongside this, public optimism for their incomes has potential to boost household consumptions to even higher levels. Indications of strengthening household consumption are also visible in higher levels of consumption credit in the banking system. However, when compared to realised household consumption for Q1/2010, household consumption growth during the period under review is estimated lower than during Q1/2009 due to heavy spending by non-government organisations in advance of the parliamentary elections (base effect factor). In the overall analysis, household consumption maintained positive expansion in Q1/2010 at an estimated 3.4% (y-o-y). Developments in leading indicators also support higher levels of Graph 2.2 Graph 2.3 Sales of Electronic Goods Private Consumption Leading Indicator household consumption in Q1/2010. Consumption of durables, such as sales of cars, motorcycles and electronic goods, maintained high growth (Graph 2.3). The retail sales index (IPE) for February 2010 reached with growth at 41.3% (yoy), ahead of 40.3% (yoy) one month earlier. The rise in the IPE is attributable to steady improvement across several commodity categories, such as food and tobacco, clothing and accessories and stationery. In similar movement, the consumer confidence index is also on the rise. Stronger growth in consumption is also reflected in more vigorous growth in consumer goods imports as of February Indicators related to consumer financing, such as real M1 growth, have also maintained an upward trend. Investment showed improvement during Q1/2010, responding to upward trends in domestic and external demand. The upswing in investment growth is consistent with leading investment indicators that point to rising investment compared to the preceding quarter (Graph 2.4). Higher investment was also reflected in more rapid growth of capital goods imports (Graph 2.5) and realised construction investment, as indicated by high levels of cement consumption. At the same time, buoyant business optimism over increased foreign orders and a conducive investment climate had a positive effect on investment growth in Q1/2010. In similar developments, investment growth in Q1/2010 reached an estimated 6.9% growth (yoy), up from the preceding quarter. In analysis by structure, investment growth in Q1/2010 was again dominated by construction. Added confirmation of improved investment growth is offered by various leading indicators. Rising levels of non-construction investment were reflected in the growing trend in capital goods imports as of February 8
17 Latest Macroe conomic Indicators Graph 2.4 Investment Leading Indicator Graph 2.5 Growth of Capital Goods Imports Graph 2.6 Growth of Cement Consumption The same trend was also reflected in higher growth in cement consumption (Graph 2.6) as of February 2010 consistent with work under way in the construction sector and infrastructure projects. These developments in investment activity were also borne out in the general improvement in realised FDI and domestic investment projects at the end of Reinforcing this is information published by the Investment Coordinating Board (BKPM) projecting an increase in realised investment in the range of billion US dollars over the same period in Besides this, higher investment benefited from greater financing support, as demonstrated by the onset of renewed growth in investment credit (Graph 2.7). Export growth strengthened in response to the steady improvement in trading partner economies and commodity prices. Reflecting this was rising demand in developed nations, such as the United States, and emerging markets led by China (Graph 2.8). The upward trend in production indices, consumer confidence levels and business sentiment in the G3 nations and China as of February 2010 provided an added boost for accelerated export growth. In other developments, the upward trend in commodity prices on the international market has had a positive effect on global trade volume, reflected in the Baltic Dry index. Trade with other countries, such as India, is also expected to expand with the conclusion of the ASEAN-India Free Trade Agreement (AI-AFTA) and the full launching of the ACFTA scheduled for early According to the latest data from the Central Statistics Agency (BPS), February 2010 exports reached billion US dollars, representing a dramatic fall of 57.05% (yoy) from February In response to these developments, Q1/2010 export growth is estimated ahead of the previous quarter at 19.0% (yoy). Growth in non-oil and gas exports was again driven by primary commodity exports led by mining products, notably coal, and agricultural products such as palm oil. Signs point to a continued positive trend in import growth during Q1/2010, consistent with strong domestic demand and rising demand from the external sector. This is visible in the improvement in leading indicators for imports compared to one quarter earlier (Graph 2.9). Following the resumption of a positive trend at end of year, imports in February were up in both annual and monthly measures. According to the latest BPS data, February 2010 exports reached 9.50 billion US dollars, an increase of 63.23% (yoy) from the same period one year before. In response to these developments, Q1/2010 import growth is estimated at 21.1% (yoy). For the time being, overall import growth continues to be driven by more vigorous expansion in imports of raw materials and intermediate inputs. Analysed by 2-digit HS commodity classification, 9
18 Monetary Policy Report - Quarter I-2010 import growth in February 2010 was driven by higher levels of imports related to capacity expansion, such as machines, mechanical tools, electrical motors and other electrical equipment. Graph 2.7 Investment Credit Growth and Gross Fixed Capital Formation Graph 2.8 Export Growth to Advance Countries Graph 2.9 Import Leading Indicator Government Financial Operations Government financial operations in January-February 2010 were marked by improved performance in budget revenues and expenditures compared to Like in previous years, the budget outcome in the first two months of 2010 resulted in a surplus, with the surplus in 2010 comparatively unchanged from Nevertheless, the budget outcome against target represented an improvement over the past year. Revenues and grants reached 11.4% of the budget target, ahead of the 2009 performance of 10.7%. This improvement was funded largely from stronger taxation revenues. A similar condition was observed in state expenditures at 9.3% of the budget target, up slightly from 9.2% of target under the 2009 budget. Key to this was a higher rate of expenditure disbursements to the regions. At the same time, realised capital expenditures at the start of the year were minimal. In regard to financing, issuance of government securities reached one third of the budget target due to conducive conditions on the government securities market, even though financial operations continued to post a surplus. Strengthening economic activity in 2010 has boosted performance in the taxation sector. During the first two months of 2010, tax receipts reached 12.2% of the budget target, ahead of the 11.5% achieved in Higher taxation revenues were generated by VAT, export taxes and excise duties. Indications suggest that rise in VAT and export tax receipts is attributable to upbeat economic activity, including higher exports. Aside from global conditions, the increase in Export Tax revenues is also the result of a policy decision to apply a higher export surcharge on crude palm oil (CPO) in keeping with price developments on the international market. 1 In contrast, income tax revenues saw relative decline, particularly in the oil and natural gas sector. Lower oil and natural gas related revenues were also reflected in non-tax revenues. However, measured against budget targets, non-tax receipts were similar to the previous year at 8.6% of target, due to lower targets. Improved absorption of government expenditures was supported by increased transfers to the regions. As of February 2010, realised transfers to regions came to 16.4% of the budget target. This represented an improvement over the 14.7% of the previous year in keeping with larger payments of Profit Sharing Funds and Special Allocation Funds. However, for the most part, only limited improvement took place in 1 CPO export tax was raised from 0% in 2009 to 3% in early 2010 in response to increased CPO prices. 10
19 Latest Macroe conomic Indicators state expenditures due to the low rate of central government expenditures at only 6.2% of the budget target, down from the previous year s level of 6.7%. This is explained by the still low rate of non-discretionary expenditures, such as Subsidies and Debt Interest. Minimum expenditures were also recorded in Capital Expenditures, which reached only 2.3% of the budget target. However, expenditure outcomes for Personnel and Social Aid were up from the same period last year. In regard to financing, strong interest among market actors resulted in issuance of Government Securities ahead of target during Q1/2010. Total issuance of Government Securities and Sharia Government Securities in Q1/2010 reached about 66.5 trillion rupiahs, or 38% of the budget target. However, this achievement still fell short of 2009, due to the size of the global bond offering in the first quarter of that year. The high volume of government securities issues resulted not only from keen interest among market actors, but also conducive conditions on the government securities market reflected in lower yield in almost all tenors on the government securities secondary market compared to the end-ofyear position in This condition also affected yield on the primary market, which also narrowed in March Aggregate Supply Business sector performance in Q1/2010 pointed to improving conditions in keeping with upbeat developments in sectoral indicators (Table 2.2). The trade, hotels and restaurants sector, transport and communications, construction and the financial services, leading and general services sector reported higher growth in Q1/2010 compared to one quarter earlier. Gains in the trade, hotels and restaurants sector were driven mainly by rising activity in the wholesale (imports) subsector and were also linked to the launching of the Asean China Free Trade Agreement (ACFTA). Similarly, expansion in the transport and communications sector again received impetus from performance in the telecommunications subsector. The leading contributors to GDP growth in Q1/2010 are expected to be the transport and Table 2.2 Economic Growth Supply Side % Y-o-Y, Base Year 2000 I t e m I II III IV I II III IV I* Agriculture Mining and Quarrying Manufacturing Electricity, Gas and Water Supply Construction Trade, Hotels and Restaurant Transportation and Communication Financial, Rental and Business Service Services GDP * Bank Indonesia Projection 11
20 Monetary Policy Report - Quarter I-2010 communications sector, manufacturing and the trade, hotels and restaurants sector. Similarly, the dominant sectors of the economy, like before, are manufacturing, the trade, hotels and restaurant sector and agriculture. Manufacturing performance in Q1/2010 maintained an upward track with growth predicted to remain stable. Rising external demand was a positive factor in manufacturing output, particularly for export-oriented industries such as in the transportation equipment, machinery and tools subsector, chemicals and rubber goods, textiles, leather goods and footwear and the wood-based and forestry products subsector. Indicators of demand in the domestic industry sector, such as car and motorcycle sales, have shown an improving trend in line with adequately robust levels of public purchasing power. Confirmation of industry sector performance also comes from leading indicators for the manufacturing sector, which point to an expansion phase. Similar trends are also visible in the BI Production Survey index, capacity utilisation and imports of industrial raw materials, which have maintained an upward trend since mid-q1/2010. Raw material imports soared by as much as 68.9% (yoy) alongside increases in the production index and capacity utilisation at 5.7% (yoy) and 7.3% (yoy) in January In regard to financing, banks reported stable growth in industry lending as of mid-q1/2010, although below the average growth for The trade, hotels and restaurants sector charted higher estimated growth in Q1/2010. Key factors in the performance of the trade, hotels and restaurants sector are rising imports and stronger manufacturing performance. Imports charted 63.23% growth (yoy) in February 2010, up from the same month one year before. At the same time, the upward trend in manufacturing performance augurs for an increase in the volume of goods traded within the trading sector. On the other hand, modest slowdown is forecasted for agriculture and mining, which also affect performance in the trade sector. Indications of rising trade sector performance are also reflected in the growth in the real sales index in the BI Retail Survey and hotel occupancy rates in Bali. During February 2010, growth in the real sales index mounted from 36.5% (yoy) in January 2010 to 40.0% (yoy). On the financing side, bank lending to the trade sector remained largely stable. Signs in the agriculture sector pointed to slowing performance in Q1/2010 explained mainly by the shift in the rice harvest. In 2010, the main harvest season is predicted for March and April. The shift in the planting season at the end of 2009 portends to concentrate the harvesting of the rice crop in April. As a result, crop production at the end of Q1/2010 was lower than for the same period one year earlier. A reasonably good rice crop is still expected during the harvest, given the lower rate of harvest failures from floods or other causes during the January-February 2010 period compared to the similar periods over the past 5 years. Based on the First Forecast Figures (ARAM I) for 2010, published by BPS, rice production is expected to mount only 0.88% over the previous year to 64.9 million tons. Although below the initial government target, this forecasted rice production is still sufficient to supply domestic requirements. Alongside this, Q1/2010 performance in the estates subsector is expected to bolster agriculture sector performance, due to brisk exports of estate commodities. On the financing side, bank lending to the agriculture sector maintained a comparatively stable trend. 12
21 Latest Macroe conomic Indicators The mining sector again reported improved performance in Q1/2010. Improvement in this sector was reflected in various leading indicators, including exports of coal, nickel, copper, ores, matte and metal concentrates, in addition to the upward trend in oil production as of early Q1/2010. Key to this was mounting demand in trading partner nations. On the other hand, external demand for coal is also supported by the long-term export sales system. In regard to financing, credit to the mining sector reported expansion as of mid-q1/2010. Estimated performance in the transport and communications sector is up in Q1/2010 compared to one quarter before. This is indicated in more robust movement in several leading indicators for the transport and communications sector. The vigorous growth in the communications subsector is reflected in the incessant rise in numbers of cellular phone subscribers as of Q4/2009. Major cellular operators report increased numbers of customers. Besides the cellular market, expansion in the telecommunications sector is also driven by the soaring use of the internet. In similar developments, indications of mounting performance in the transport subsector are evident in air and rail passenger numbers as of February 2010, with growth running at 23.3% (yoy) and 1.4% (yoy). Brisk growth as of early Q1/2010 was also reported in another indicator, namely cargo traffic at Indonesia s five major ports (Belawan, Tanjung Priok, Tanjung Perak, Balikpapan and Makassar), at 5.6% (yoy). In regard to financing, bank lending to the transport and communications sector expanded at a slightly slower rate until mid-q1/2010. Construction sector growth improved during Q1/2010 to an estimated 8.1% (yoy). Leading indicators point to more robust growth in the construction sector. Among these indicators are cement consumption and production, both on the rise as of mid-q1/2010. In February 2010, cement consumption growth strengthened slightly from 13.2% (yoy) in January 2010 to 13.4% (yoy). At the same time, cement production saw growth climb from 13.3% (yoy) in January 2010 to 14.5% (yoy) in February In regard to financing, bank lending to the construction sector is estimated to have halted decline as of February Graph 2.10 Export Volume Growth Regional Economic Performance Estimates point to improved economic growth at the regional level, supported by the buoyant economies in Jakarta, Sumatra and the Kali- Sulampua region. During this period, the launching of the AC-FTA has opened new opportunities for regions with resource-based production. The performance of the Indonesian economy showed significant improvement in Q4/2009 with growth at 5.4%, bringing overall economic growth in 2009 to a respectable 4.5% (yoy). In general terms, the driving force for growth in 2009 came from robust consumption in Jakarta and Jabalnustra and exports from Sumatra and the Kali-Sulampua region to China and India. Strong consumption at the regional level was supported in part by high rates of realised consumption expenditures in Regional Budgets that averaged 92.6%, up from 83.1% in Expenditure growth was particularly strong in spending on goods/ services and social aid. 13
22 Monetary Policy Report - Quarter I-2010 Graph 2.11 Growth of Regional Cement Consumption The renewed vigour in regional economies is estimated to have carried forward into Q1/2010, bolstered by rising growth in the economies of Sumatra and Kali-Sulampua and buoyant economic growth in Jakarta. On the demand side, exports were up for estate crops (CPO, coffee) and mining products (coal, nickel) in Sumatra and the Kali-Sulampua region (Graph 2.10), while consumption showed a slowing trend. Investment showed renewed improvement, particularly in Jakarta alongside rising private capital expenditures. In disaggregation by sector, industry was up in Jakarta and the Jabalnustra region with support from mining in Sumatra and the Kali-Sulampua region and trade in Jakarta and Sumatra. The launching of the AC-FTA has created fresh opportunities for CPO and coffee exporting regions in Sumatra and mining exports from Kali-Sulampua. Despite this, the textiles and textile products and food processing industries in Jabalnustra face challenges, although opportunities loom for other industries (furniture, handicrafts). Graph 2.12 Inflation in Jakarta While regional inflation was quite low during Q1/2010, some regions are projected to have above national inflation due to distribution problems. Most of the regions with above national inflation are found in the Kali-Sulampua region. The low inflation in the regions is explained by the onset of harvest in March in some regions, while weather-related bottlenecks hampering the distribution of goods is a factor driving up prices in regions other than Jakarta. On the demand side, the reasonably strong public purchasing power in the regions has capacity to respond to increased production. Despite this, difficulties arise in relation to tight supply (sugar, rice) and even potential for inflationary pressure from diminishing cargo traffic to Java and outside Java. BALANCE OF PAYMENTS (BOP) Buoyant domestic macroeconomic conditions and positive external conditions were key to Indonesia s solid external performance during Q1/2010. Widespread positive sentiment over the recovery in the world economy was again the primary factor in Indonesia s strong balance of payments performance, particularly in merchandise trade. Overall, the Q1/2010 balance of payments posted an estimated surplus. With this surplus, international reserves reached 71.8 billion US dollars, equivalent to 5.8 months of imports and servicing of official external debt. The improved export performance is indicated as driven by positive developments in commodity prices and strong demand for resource-based commodities in some nations, and particularly emerging markets. Nevertheless, the greater absorption capacity of the domestic economy has spurred imports, thus offsetting the rise in export turnover. Taken together, the merchandise trade balance posted an estimated surplus. At the same time, the relatively brisk recovery in Asia has given added attraction to investment in financial assets. Despite temporary shocks brought on by negative sentiment over the fiscal instability 14
Jl.MH. Thamrin No.2 Jakarta Indonesia
Jl.MH. Thamrin No.2 Jakarta 10110 - Indonesia http://www.bi.go.id BANK INDONESIA For further information. please contact: Economic Outlook & Policy Dissemination Bureau of Monetary Policy Directorate of
More information4. Economic Outlook. ASSUMPTIONS AND SCENARIOS Condition of the International Economy World economic growth is predicted. to remain strong in 2007,
Monetary Policy Report - Quarter II-2007 4. Economic Outlook Overall, the accelerated pace of economic growth of 2007-2008 is predicted to carry forward, being accompanied by sustained macroeconomic stability.
More informationBANK INDONESIA. Telephone : Fax. : Website :
BANK INDONESIA For further information. please contact: Short-term Outlook dan Policy Dissemination Division Monetary Policy Group Economic Research and Monetary Policy Department Telephone : +62 61 3818163
More informationJl.MH. Thamrin No.2 Jakarta Indonesia
Jl.MH. Thamrin No.2 Jakarta 10110 - Indonesia http://www.bi.go.id BANK INDONESIA For further information. please contact: Economic Outlook & Policy Dissemination Bureau of Monetary Policy Directorate of
More informationMonetary Policy Review May 2010
Monetary Policy Review May 2010 The Monetary Policy Review (MPR) is published monthly by Bank Indonesia after the Board of Governors Meeting each February, March, May, June, August, September, November,
More informationRecent Economic Developments
REPUBLIC OF INDONESIA Recent Economic Developments January, 2010 Published by Investors Relations Unit Republic of Indonesia Address Bank Indonesia International Directorate Investor Relations Unit Sjafruddin
More informationMID-TERM REVIEW OF THE 2014 MONETARY POLICY STATEMENT
MID-TERM REVIEW OF THE 2014 MONETARY POLICY STATEMENT 1. INTRODUCTION 1.1 The Mid-Term Review (MTR) of the 2014 Monetary Policy Statement (MPS) examines recent price developments and reviews key financial
More informationJl.MH. Thamrin No.2 Jakarta Indonesia
Jl.MH. Thamrin No.2 Jakarta 10110 - Indonesia http://www.bi.go.id BANK INDONESIA For further information. please contact: Short-term Outlook dan Policy Dissemination Division Monetary Policy Group Economic
More informationBANK INDONESIA. Telephone : Fax. : Website :
BANK INDONESIA For further information, please contact: Economic Outlook & Policy Dissemination Bureau of Monetary Policy Directorate of Economic Research and Monetary Policy Telephone : +62 61 3818163
More informationKEYNOTE SPEECH Deputy Governor of Bank Indonesia, Bp. Perry Warjiyo Ph.D at BNP Paribas Economic Outlook 2016 Jakarta, 23 March 2016
KEYNOTE SPEECH Deputy Governor of Bank Indonesia, Bp. Perry Warjiyo Ph.D at BNP Paribas Economic Outlook 2016 Jakarta, 23 March 2016 Introduction Following the success of strong macroeconomic policy adjustments
More informationMonetary Policy Review September 2012
Monetary Policy Review September 2012 The Monetary Policy Review (MPR) is published monthly by Bank Indonesia after the Board of Governors Meeting each January, February, March, May, June, August, September,
More informationIndonesia: Changing patterns of financial intermediation and their implications for central bank policy
Indonesia: Changing patterns of financial intermediation and their implications for central bank policy Perry Warjiyo 1 Abstract As a bank-based economy, global factors affect financial intermediation
More informationMONETARY POLICY REPORT JANUARY 2007
MONETARY POLICY REPORT BANK INDONESIA MONETARY POLICY REPORT JANUARY 2007 The Monetary Policy Report is published quarterly by Bank Indonesia after the Board of Governors» Meetings in April, July, October,
More informationMonetary Policy Review February 2013
Monetary Policy Review February 2013 The Monetary Policy Review (MPR) is published monthly by Bank Indonesia after the Board of Governors Meeting each January, February, March, May, June, August, September,
More informationFinland falling further behind euro area growth
BANK OF FINLAND FORECAST Finland falling further behind euro area growth 30 JUN 2015 2:00 PM BANK OF FINLAND BULLETIN 3/2015 ECONOMIC OUTLOOK Economic growth in Finland has been slow for a prolonged period,
More informationHONDURAS. 1. General trends
Economic Survey of Latin America and the Caribbean 2016 1 HONDURAS 1. General trends Economic growth in Honduras picked up in 2015, reaching 3.6%, compared with 3.1% in 2014. This performance was mainly
More informationThe usage of surveys to overrun data gaps: Bank Indonesia s experience
The usage of surveys to overrun data gaps: Bank Indonesia s experience Hendy Sulistiowaty and Ari Nopianti I. Introduction The global economic recession that triggered in late 2007 in the United States
More informationARGENTINA. 1. General trends
1 ARGENTINA 1. General trends After slowing rapidly in 2009, the Argentine economy resumed robust growth in 2010, with a rate well above the regional average at 9.2%. On the back of this the unemployment
More informationJan F Qvigstad: Outlook for the Norwegian economy
Jan F Qvigstad: Outlook for the Norwegian economy Address by Mr Jan F Qvigstad, Deputy Governor of Norges Bank (Central Bank of Norway), at Sparebank 1 Fredrikstad, 4 November 2009. The text below may
More informationMonetary Policy Review March 2009
Monetary Policy Review March 2009 The Monetary Policy Review (MPR) is published monthly by Bank Indonesia after the Board of Governors Meeting each February, March, May, June, August, September, November,
More informationBUSINESS SURVEY QUARTER IV A. Business Activity. Business Survey
Business BUSINESS SURVEY QUARTER IV-2017 The Bank Indonesia Business revealed slower business growth in the fourth quarter of 2017, mirroring cyclical trends. Such developments were reflected by a decline
More informationAssalamu alaikumwr. Wb, Very good morning to all of you, Honourable speakers, Distinguished Guests, Ladies and Gentlemen,
Opening Remarks Dr. Hartadi A. Sarwono, Deputy Governor of Bank Indonesia The 9 th Bank Indonesia Annual International Seminar Nusa Dua-Bali, December 9 th, 2011 Assalamu alaikumwr. Wb, Very good morning
More informationNATIONAL BANK OF SERBIA. Speech at the presentation of the Inflation Report May Dr Jorgovanka Tabaković, Governor
NATIONAL BANK OF SERBIA Speech at the presentation of the Inflation Report May Dr Jorgovanka Tabaković, Governor Belgrade, May Ladies and gentlemen, representatives of the press, dear colleagues, Welcome
More informationMINUTES OF THE MONETARY POLICY COMMITTEE MEETING 4 AND 5 NOVEMBER 2009
Publication date: 18 November 2009 MINUTES OF THE MONETARY POLICY COMMITTEE MEETING 4 AND 5 NOVEMBER 2009 These are the minutes of the Monetary Policy Committee meeting held on 4 and 5 November 2009. They
More informationIndonesia. Real Sector. The economy grew 3.7% in the first three quarters.
Indonesia Real Sector The economy grew 3.7% in the first three quarters. The economy grew in a 3.5-4% range in each of the first three quarters, in spite of adverse effects from the 22 Bali bombing, the
More informationOntario Economic Accounts
SECOND QUARTER OF 2017 April, May, June Ontario Economic Accounts ONTARIO MINISTRY OF FINANCE Table of Contents ECONOMIC ACCOUNTS Highlights 1 Ontario s Economy Continues to Grow Expenditure Details 2
More informationEUROPEAN COMMISSION DIRECTORATE-GENERAL FOR ECONOMIC AND FINANCIAL AFFAIRS. September 2006 Interim forecast
EUROPEAN COMMISSION DIRECTORATE-GENERAL FOR ECONOMIC AND FINANCIAL AFFAIRS September 26 Interim forecast Press conference of 6 September 26 European economic growth speeding up, boosted by buoyant domestic
More informationMonetary Policy Review September 2010
Monetary Policy Review September 20 The Monetary Policy Review (MPR) is published monthly by Bank Indonesia after the Board of Governors» Meeting each February, March, May, June, August, September, November,
More informationSri Lanka: Recent Economic Trends. January 2018
Sri Lanka: Recent Economic Trends January 2018 1 Agenda Summary Economic Growth Inflation and Monetary Policy External Account Fiscal Scenario of Government of Sri Lanka ICRA Lanka Limited 2 2 Agenda Summary
More informationThe real change in private inventories added 0.15 percentage points to the second quarter GDP growth, after subtracting 0.65% in the first quarter.
QIRGRETA Monthly Macroeconomic Commentary United States The U.S. economy rebounded in the second quarter of 2007, growing at an annual rate of 3.4% Q/Q (+1.8% Y/Y), according to the GDP advance estimates
More informationBELIZE. 1. General trends
Economic Survey of Latin America and the Caribbean 2015 1 BELIZE 1. General trends The economy recovered in 2014 with growth strengthening to 3.6% up from 1.5% in 2013. Growth was driven by increased dynamism
More informationECONOMY REPORT - CHINESE TAIPEI
ECONOMY REPORT - CHINESE TAIPEI (Extracted from 2001 Economic Outlook) REAL GROSS DOMESTIC PRODUCT The Chinese Taipei economy grew strongly during the first three quarters of 2000, thanks largely to robust
More informationGrowth and Inflation Prospects and Monetary Policy
Growth and Inflation Prospects and Monetary Policy 1. Growth and Inflation Prospects and Monetary Policy The Thai economy expanded by slightly less than the previous projection due to weaker-than-anticipated
More informationBANK OF FINLAND ARTICLES ON THE ECONOMY
BANK OF FINLAND ARTICLES ON THE ECONOMY Table of Contents Global economy to grow steadily 3 FORECAST FOR THE GLOBAL ECONOMY Global economy to grow steadily TODAY 1:00 PM BANK OF FINLAND BULLETIN 1/2017
More informationThe real change in private inventories added 0.22 percentage points to the second quarter GDP growth, after subtracting 0.65% in the first quarter.
QIRGRETA Monthly Macroeconomic Commentary United States The U.S. economy bounced back in the second quarter of 2007, growing at the fastest pace in more than a year. According the final estimates released
More informationBismillahirrahmanirrahim, Assalamu alaikum warahmatullahi wabarakatuh,
KEYNOTE ADDRESS BY DR. DARMIN NASUTION GOVERNOR OF BANK INDONESIA AT THE INDONESIA INVESTMENT FORUM JAKARTA, 29 SEPTEMBER 2010 Bismillahirrahmanirrahim, Assalamu alaikum warahmatullahi wabarakatuh, Peace
More informationMalaysia. Real Sector. Economic recovery is gaining momentum.
Malaysia Real Sector Economic recovery is gaining momentum. Malaysia s economy grew 4.7% in the first three quarters of 23, well above the year-earlier pace of 3.7%. GDP rose 5.1% in the third quarter,
More informationSEPTEMBER Overview
Overview SEPTEMBER 214 Global growth. Global growth has been weaker than expected so far this year, as economic activity disappointed in a number of major countries in the first six months (Figure 1).
More informationGUATEMALA. 1. General trends
Economic Survey of Latin America and the Caribbean 2016 1 GUATEMALA 1. General trends In 2015, Guatemala s GDP grew by 4.1% in real terms (a figure similar to the 4.2% recorded the previous year), driven
More informationInflation Report. January March 2013
January March 2013 May 8, 2013 Outline 1 External Conditions 2 Economic Activity in Mexico 3 Monetary Policy and Inflation Determinants 4 Forecasts and Balance of Risks 2 External Conditions Global Environment
More informationINDONESIAN ECONOMY Recent Developments and Challenges. BUDI MULYA Deputy Governor of Bank Indonesia
INDONESIAN ECONOMY Recent Developments and Challenges BUDI MULYA Deputy Governor of Bank Indonesia Addressed at OCBC Global Treasury Economic and Business Forum Singapore, 9 July 2010 First of all, I would
More informationViet Nam GDP growth by sector Crude oil output Million metric tons 20
Viet Nam This economy is weathering the global economic crisis relatively well due largely to swift and strong policy responses. The GDP growth forecast for 29 is revised up from that made in March and
More informationAntonio Fazio: Overview of global economic and financial developments in first half 2004
Antonio Fazio: Overview of global economic and financial developments in first half 2004 Address by Mr Antonio Fazio, Governor of the Bank of Italy, to the ACRI (Association of Italian Savings Banks),
More informationAsia Bond Monitor June 2018
September 8 asianbondsonline.adb.org Key Developments in Asian Local Currency Markets Japan s industrial production fell.% on a month-on-month (m-o-m) basis but rose.% on a year-on-year (y-o-y) basis in
More informationASEAN Insights: Regional trends
ASEAN Insights: Regional trends January 2017 1. Global trends GLOBAL ECONOMY AND EQUITY MARKETS ENTER 2017 ON A STRONG NOTE DESPITE GEOPOLITICAL UNCERTAINTIES The global economy entered 2017 on a strong
More informationBRAZIL. 1. General trends
Economic Survey of Latin America and the Caribbean 2014 1 BRAZIL 1. General trends In 2013, the Brazilian economy grew by 2.5%, an improvement over the 1% growth recorded in 2012. That low growth continued
More informationMonetary Policy Report
CENTRAL BANK OF THE GAMBIA Monetary Policy Report November 20 The Central Bank of The Gambia Monetary Policy Report provides summary of reports presented at the Monetary Policy Committee Meeting. It entails
More informationDOMINICAN REPUBLIC. 1. General trends
Economic Survey of Latin America and the Caribbean 2016 1 DOMINICAN REPUBLIC 1. General trends The economy of the Dominican Republic grew by 7.0% in 2015, compared with 7.3% in 2014. That growth is driven
More informationMauritius Economy Update January 2015
January 19, 2015 Economics Mauritius Economy Update January 2015 Overview - Mauritian economy has been witnessing a persistent moderation in growth since 2010 due to weak economic activity in Euro Zone,
More informationEconomic Projections :1
Economic Projections 2017-2020 2018:1 Outlook for the Maltese economy Economic projections 2017-2020 The Central Bank s latest economic projections foresee economic growth over the coming three years to
More informationOutlook for Economic Activity and Prices (April 2010)
April 30, 2010 Bank of Japan Outlook for Economic Activity and Prices (April 2010) The Bank's View 1 The global economy has emerged from the sharp deterioration triggered by the financial crisis and has
More informationMID-TERM REVIEW OF THE 2013 MONETARY POLICY STATEMENT
MID-TERM REVIEW OF THE MONETARY POLICY STATEMENT. INTRODUCTION. The Mid-Term Review (MTR) of the Monetary Policy Statement (MPS) evaluates progress in achieving the percent medium-term inflation objective.
More informationMinutes of the Monetary Policy Council decision-making meeting held on 2 September 2015
Minutes of the Monetary Policy Council decision-making meeting held on 2 September 2015 Members of the Monetary Policy Council discussed monetary policy against the background of the current and expected
More informationReview of the Economy. E.1 Global trends. January 2014
Export performance was robust during the third quarter, partly on account of the sharp depreciation in the exchange rate of the rupee and partly on account of a modest recovery in major advanced economies.
More informationJarle Bergo: Monetary policy and the cyclical situation
Jarle Bergo: Monetary policy and the cyclical situation Speech by Mr Jarle Bergo, Deputy Governor of Norges Bank (Central Bank of Norway), at a meeting with local authorities and the business community,
More informationEconomic ProjEctions for
Economic Projections for 2016-2018 ECONOMIC PROJECTIONS FOR 2016-2018 Outlook for the Maltese economy 1 Economic growth is expected to ease Following three years of strong expansion, the Bank s latest
More informationVI. THE EXTERNAL ECONOMY
VI. THE EXTERNAL ECONOMY India s external sector has continued to register robust performance during 2006-07 so far. Merchandise exports have exhibited strong growth, notwithstanding some deceleration.
More informationEconomic projections
Economic projections 2017-2020 December 2017 Outlook for the Maltese economy Economic projections 2017-2020 The pace of economic activity in Malta has picked up in 2017. The Central Bank s latest economic
More informationCOLOMBIA. 1. General trends
Economic Survey of Latin America and the Caribbean 2016 1 COLOMBIA 1. General trends Real GDP climbed 3.1% in 2015, driven by strong momentum in the finance, commerce and construction sectors, which offset
More informationMEXICO. 1. General trends
Economic Survey of Latin America and the Caribbean 2015 1 MEXICO 1. General trends Real GDP growth in Mexico in 2014 was 2.1%, up 0.7 percentage points on 2013. This increase stems from a good export performance,
More informationEconomic Survey of Latin America and the Caribbean CHILE. 1. General trends. 2. Economic policy
Economic Survey of Latin America and the Caribbean 2017 1 CHILE 1. General trends In 2016 the Chilean economy grew at a slower rate (1.6%) than in 2015 (2.3%), as the drop in investment and exports outweighed
More informationRecent developments in the Global and South African economies
Day Month Year Recent developments in the Global and South African economies Presented by: Nico Kelder Senior Economist Industrial Development Corporation of South Africa 2010 Growth, Development and Investment
More informationOutlook for Economic Activity and Prices
Not to be released until : p.m. Japan Standard Time on Saturday, October 31, 15. October 31, 15 Bank of Japan Outlook for Economic Activity and Prices October 15 (English translation prepared by the Bank's
More informationDevelopments in inflation and its determinants
INFLATION REPORT February 2018 Summary Developments in inflation and its determinants The annual CPI inflation rate strengthened its upward trend in the course of 2017 Q4, standing at 3.32 percent in December,
More informationSada Reddy: Fiji s economy
Sada Reddy: Fiji s economy Presentation by Mr Sada Reddy, Deputy Governor of the Reserve Bank of Fiji, to the FIJI NZ Business Council, Suva, 3 October 2008. * * * Outline The outline of my presentation
More information2. International developments
2. International developments (6) During the period, global economic developments were generally positive. The economy grew faster in the second quarter, mainly driven by the favourable financing conditions
More informationFor further information : Short-term Outlook and Policy Dissemination Team Monetary Policy Bureau Economic Research and Monetary Policy Directorate
For further information : Short-term Outlook and Policy Dissemination Team Monetary Policy Bureau Economic Research and Monetary Policy Directorate Phone : + 62 21 381 8180 + 62 21 381 8163 + 62 21 381
More informationNo. 43/2018 Monetary Policy Report, June 2018 Mr. Jaturong Jantarangs, Assistant Governor of the Bank of Thailand (BOT) and Secretary of the Monetary
No. 43/2018 Monetary Policy Report, June 2018 Mr. Jaturong Jantarangs, Assistant Governor of the Bank of Thailand (BOT) and Secretary of the Monetary Policy Committee (MPC), released the June 2018 issue
More informationECONOMY REPORT - BRUNEI DARUSSALAM
ECONOMY REPORT - BRUNEI DARUSSALAM (Extracted from 2001 Economic Outlook) REAL GROSS DOMESTIC PRODUCT In 2000, Brunei Darussalam s economy improved and grew at 3 percent, compared to 2.5 percent in the
More informationEurozone Economic Watch Higher growth forecasts for January 2018
Eurozone Economic Watch Higher growth forecasts for 2018-19 January 2018 Eurozone Economic Watch January 2018 Eurozone: Higher growth forecasts for 2018-19 Our MICA-BBVA model estimates a broadly stable
More informationMinutes of the Monetary Policy Council decision-making meeting held on 6 July 2016
Minutes of the Monetary Policy Council decision-making meeting held on 6 July 2016 At the meeting, members of the Monetary Policy Council discussed monetary policy against the background of macroeconomic
More informationMacroeconomic and financial market developments. March 2014
Macroeconomic and financial market developments March 2014 Background material to the abridged minutes of the Monetary Council meeting 25 March 2014 Article 3 (1) of the MNB Act (Act CXXXIX of 2013 on
More informationASEAN Insights: Regional trends
ASEAN Insights: Regional trends March 2017 1. Global trends GLOBAL ECONOMY SHOWS RESILIENCE AND RESURGENCE WITH STRONG BUSINESS SENTIMENT, ACCELERATION IN TRADE MOMENTUM The global economy continued its
More informationTable 1.1: Selected Economic Indicators
1 Overview The overall economic environment continues to remain conducive for growth. An accommodative monetary policy stance; increase in development spending; substantial growth in private sector credit,
More informationINDONESIA. The Real Economy
INDONESIA Macroeconomic stability is strengthening in Indonesia. The external environment is likely to be supportive for the economy. This positive trend is reflected in the recent upgrade of Indonesia
More informationIMF Executive Board Concludes 2010 Article IV Consultation with Indonesia Public Information Notice (PIN) No. 10/130 September 16, 2010
IMF Executive Board Concludes 2010 Article IV Consultation with Indonesia Public Information Notice (PIN) No. 10/130 September 16, 2010 Public Information Notices (PINs) form part of the IMF's efforts
More informationBusiness cycles in South Africa during the period 1999 to 2007
Business cycles in South Africa during the period 19 to 7 by J C Venter 1 Introduction The South African Reserve Bank (the Bank) has identified reference turning points in the cyclical movement of the
More informationHighlights 2/2017. Main topics: Ministry of Finance of the Republic of Bulgaria. Economic and Financial Policy Directorate ISSN
BULGARIAN месечен ECONOMY обзор Monthly Report Ministry of Finance of the Republic of Bulgaria 2/217 Economic and Financial Policy Directorate ISSN 2367-2 Main topics:» Gross domestic product» Short-term
More informationEconomic Projections :2
Economic Projections 2018-2020 2018:2 Outlook for the Maltese economy Economic projections 2018-2020 The Central Bank s latest economic projections foresee economic growth over the coming three years to
More informationGUATEMALA. 1. General trends
Economic Survey of Latin America and the Caribbean 2014 1 GUATEMALA 1. General trends GDP grew by 3.7% in 2013 in real terms, versus 3.0% in 2012, reflecting the robustness of domestic demand, mainly from
More informationNATIONAL BANK OF SERBIA. Speech at the presentation of the Inflation Report February Dr Jorgovanka Tabaković, Governor
NATIONAL BANK OF SERBIA Speech at the presentation of the Inflation Report February 8 Dr Jorgovanka Tabaković, Governor Belgrade, February 8 Ladies and gentlemen, dear media representatives, esteemed colleagues,
More informationMalaysia- GDP & BOP 1Q17
Real GDP growth surprised on the upside in 1Q17 Real GDP growth rose by 5.6% in 1Q17, exceeding market expectations Malaysia s real GDP growth rose by 5.6% yoy in 1Q17 (4.5% in 4Q16), significantly higher
More informationEconomic activity gathers pace
Produced by the Economic Research Unit October 2014 A quarterly analysis of trends in the Irish economy Economic activity gathers pace Positive data flow Recovery broadening out GDP growth revised up to
More informationThe Economic Outlook of Taiwan
The Economic Outlook of Taiwan by Ray Yeutien Chou and An-Chi Wu The Institute of Economics, Academia Sinica, Taipei October 2017 1 Prepared for Project LINK 2017 Fall Meeting, Geneva, Oct. 3-5, 2017 2
More informationEconomic Update 4 July 2017
Economic Update July 17 Macroeconomic outlook UAE: Growth set to moderate slightly in 17 amid crude oil cuts > Dana Al-Fakir Economist +9 9 373, danafakir@nbk.com > Nemr Kanafani Senior Economist +9 9
More informationBELIZE. 1. General trends
Economic Survey of Latin America and the Caribbean 2017 1 BELIZE 1. General trends The Belizean economy experienced a reversal of fortunes in 2016, with growth dropping to -0.8% from 2.9% in 2015. A sharp
More informationProjections for the Portuguese Economy:
Projections for the Portuguese Economy: 2018-2020 March 2018 BANCO DE PORTUGAL E U R O S Y S T E M BANCO DE EUROSYSTEM PORTUGAL Projections for the portuguese economy: 2018-20 Continued expansion of economic
More informationGlobal Update. 6 th October, Global Prospects. Contacts: Madan Sabnavis Chief Economist
Global Update Global Prospects 6 th October, 2010 Contacts: Madan Sabnavis Chief Economist 91-022-6754 3489 Samruddha Paradkar Associate Economist 91-022-6754 3407 Krithika Subramanian Associate Economist
More informationIndonesia Economic Outlook and Policy Challenges
Indonesia Economic Outlook and Policy Challenges Daniel A. Citrin Asia and Pacific Department, IMF April 3, 28 Global Financial Stability Map: risks have risen; conditions have deteriorated October 27
More informationPrudential International Investments Advisers, LLC. Global Investment Strategy March 2010
Prudential International Investments Advisers, LLC. Global Investment Strategy March 2010 By John Praveen, Chief Investment Strategist For Market Commentary Interviews Contact: Lisa Villareal, 973-367-2503/lisa.villareal@prudential.com
More informationMonetary Policy Review August 2008
Monetary Policy Review August 2008 The Monetary Policy Review (MPR) is published monthly by Bank Indonesia after the Board of Governors» Meeting each February, March, May, June, August, September, November,
More informationBELIZE. 1. General trends
Economic Survey of Latin America and the Caribbean 2016 1 BELIZE 1. General trends Economic growth fell from 4.1% in 2014 to 1.2% in 2015, as slower activity later in the year pulled down the average for
More informationMonetary Policy Report, September 2017
No. 52/2017 Monetary Policy Report, September 2017 Mr. Jaturong Jantarangs, Assistant Governor of the Bank of Thailand (BOT) and Secretary of the Monetary Policy Committee (MPC), released the September
More informationMarket volatility to continue
How much more? Renewed speculation that financial institutions may report increased US subprime-related losses has sent equity markets tumbling. How much more bad news can investors expect going forward?
More information2011 Economic Report on Indonesia. Indonesia s Economic Resilience Amid Global Economic Uncertainty
2011 Economic Report on Indonesia Indonesia s Economic Resilience Amid Global Economic Uncertainty 2011 Economic Report on Indonesia ISSN 0522-2572 2011 Economic Report on Indonesia i Vision To be recognized
More informationSvein Gjedrem: The outlook for the Norwegian economy
Svein Gjedrem: The outlook for the Norwegian economy Address by Mr Svein Gjedrem, Governor of Norges Bank (Central Bank of Norway), at the Bergen Chamber of Commerce and Industry, Bergen, 11 April 2007.
More informationManaging Global Shocks: The Case of Indonesia
Managing Global Shocks: The Case of Indonesia Dr. Hartadi A. Sarwono Deputy Governor IIF Asian Regional Economic Forum Singapore, March 5, 2009 Outline 2 1. Crisis highlights 2. Macroconomic Condition
More informationOVERVIEW. The EU recovery is firming. Table 1: Overview - the winter 2014 forecast Real GDP. Unemployment rate. Inflation. Winter 2014 Winter 2014
OVERVIEW The EU recovery is firming Europe's economic recovery, which began in the second quarter of 2013, is expected to continue spreading across countries and gaining strength while at the same time
More informationUkraine Macroeconomic Situation
In 2012, industrial production was down by 1.8% yoy as weakening global demand for steel exerted a toll on the Ukrainian metallurgical industry. Last year, harvested 46.2 tons of grains and overseas shipments
More informationKBank Capital Markets Perspectives 29 February 2016
KBank Capital Markets Perspectives 29 February 2016 Thailand Economic Monitor and BoT Forecast : March 2016 Thailand s economy steadied in February, though domestic demand decelerated slightly from January
More information