Indonesia posts trade surplus as imports slide
Indonesia's exports plunged by almost a third in February compared to a year ago, officials said Wednesday, in the latest sign of trouble for Southeast Asia's biggest economy.
But the trade surplus increased to 2.52 billion dollars from 1.98 billion in January as imports dived even faster, the Central Statistics Agency was quoted by AFP as saying.
Imports fell 41.6 percent year on year to 4.56 billion dollars, while exports declined 32.89 percent to 7.08 billion dollars, the agency said. The figures are the latest indication of how Indonesia's export-heavy economy is being squeezed by the slowdown in demand for its commodities due to the global economic slump.
Exports in January fell more than 36 percent year on year. But President Susilo Bambang Yudhoyono is hoping the economy can avoid recession as he battles for a second five-year-term in election in July.
The government has revised growth estimates for 2009 down from more than six percent to below four percent. The last time Indonesia's economy grew at less than four percent was in 2001.
Central bank heads will have the opportunity to lower interest rates to spur the economy when they meet later this week after the statistics agency said inflation eased to 7.92 percent in March from 8.60 percent in February.
The Consumer Price Index gained 0.22 percent month on month after rising 0.21 percent in February. Bank Indonesia is expected to cut its key interest rate by 25 basis points to 7.5 percent on Friday.
ING economist Tim Condon told Dow Jones Newswires: "We are entering the period when food price inflation typically slows sharply and we expect this to sustain disinflation in the months ahead."
Indonesian shares ended 1.93 percent higher Wednesday on expectations that lower interest rates would ease companies' debt burdens. The Jakarta Composite Index gained 27.67 points to 1,461.74 in moderate volume.
"I see inflows that drove the main index higher but the question remains whether gains (of the main index) will be sustained for the rest of the week," a fund manager told Dow Jones Newswires.
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