ASEAN KEY DESTINATIONS
BI forecasts RI current account deficit at 1.6% of GDP
Bank Indonesia (BI) has said that Indonesia’s trade balance, which recorded a US$2.43 billion surplus in the first three months of 2015, will lead the country’s current account deficit to be lower than expected.
The central bank predicts that in the first quarter of 2015, Indonesia’s current account deficit will stand at 1.6 percent of gross domestic product (GDP), lower than its initial forecast of between 1.8 and 2 percent.
BI’s monetary and economic policy department executive director Juda Agung said the bank’s lower prediction on the current account deficit was due to Indonesia’s trade balance surplus, which reached $1.13 billion in March. As a result, the country’s trade balance recorded a surplus of $2.43 billion in three months, higher than last year’s January-March surplus, which reached $1.07 billion.
Juda said Indonesia’s economic activities had remained low in the first quarter of this year, meaning its income balance would be also lower than initially predicted.
“The outlook until the end of this year will be at around 3 percent. There is a possibility that it will be slightly lower than 3 percent,” he explained.
Last year, Indonesia’s current account recorded a deficit of $4.15 billion, 1.97 percent of GDP.
Juda went on that in the second quarter of this year, the country’s current account deficit would increase, as the government’s infrastructure projects had begun, leading to increases in imports and repatriation of dividends or asset outflows starting in June.
Last year, the current account deficit in the second quarter reached $8.94 billion or 3.97 percent of GDP.
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