Agus Martowardojo, the governor of Indonesia's central bank (Bank Indonesia), provided some new forecasts with regard to Indonesia's economic growth and rupiah. On Tuesday (06/06) Martowardojo told at a parliamentary hearing that he expects the rupiah to depreciate modestly in 2018, while economic growth should accelerate. Meanwhile, Indonesian Finance Minister Sri Mulyani Indrawati said Indonesia's state budget deficit is estimated to widen slightly more-than-expected in 2017.

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On early Monday morning we detect light trading in Asian stock markets. This is mainly because markets in the USA, United Kingdom and China are closed for a public holiday today (29/05), while investors are also awaiting speeches from Federal Reserve and European Central Bank (ECB) officials as well as the US jobs report (due on 2 June). Meanwhile, North Korea again caused rising tensions as it launched another ballistic missile in its latest test.

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Most Asian stocks are in the green zone on Monday morning (22/05), tracking Wall Street's performance on Friday where investors' attention shifted from recent political drama - related to US President Donald Trump - to good corporate earnings of Deere and Caterpillar. Meanwhile, rising crude oil ahead of the OPEC meeting on Friday (May 25, 2017) added positive sentiments to markets. Indonesia is again on track to finish at a new all-time record high.

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It is not a good day for stocks across the Asia-Pacific today. After US stocks on Wall Street tumbled overnight on persistent concerns about political stability in the USA - as President Donald Trump allegedly tried to interfere in a federal investigation by urging former FBI chief James Comey to end a probe into former National Security Adviser Michael Flynn's ties with Russia - Asian stocks are following suit on Thursday (18/05).

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Indonesia's benchmark Jakarta Composite Index fell 0.56 percent to 5,615.49 points on Wednesday (17/05), in line with the performance of stocks across the Asia-Pacific region. The weak performance is caused by increasing concern about the controversial actions and policies of US President Donald Trump. After the emergence of several new scandals over the past couple of days more and more people assume Trump will not be able to finish his presidential term as calls for impeachment are heard.

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Starting from March 5, 2018, Indonesian citizens as well as foreigners need to be a bit more careful when bringing foreign-denominated cash money into Indonesia. A new Bank Indonesia regulation sets a IDR 1 billion (approx. USD $75,000) ceiling on the total amount of foreign cash money an individual can bring into Indonesia.

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Sugeng, Deputy Governor of Indonesia's central bank (Bank Indonesia),  confirmed on Monday morning (08/05) that his institution has recently been intervening in the foreign exchange market in an effort to limit sharp rupiah appreciation. So far in 2017 the Indonesian rupiah has appreciated 1.11 percent against the US dollar with most of the rupiah's advance stemming from the first month of the year.

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As widely expected, the Federal Reserve kept its benchmark interest rate unchanged after May's two-day policy meeting that was concluded on Wednesday (03/05). The US central bank also delivered a rather hawkish policy statement, downplaying weak Q1-2017 economic growth and emphasizing the strength of the US labor market. This implies the Fed is still on track for two more rate hikes in the remainder of 2017.

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Yesterday's Jakarta gubernatorial election seems to have little impact on the performance of Indonesian stocks and the rupiah today (20/04). While Indonesia's benchmark Jakarta Composite Index is cautiously higher (in line with the general trend of Asian stocks this morning), the Indonesian rupiah had depreciated 0.10 percent to IDR 13,332 per US dollar (Bloomberg Dollar Index) by 10:00 am local Jakarta time on Thursday (20/04). The rupiah performance is slightly out of tune with most other Asian currencies but its weakening is still rather insignificant.

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It was a good day for Indonesian stocks on Wednesday (29/03) as the nation's benchmark Jakarta Composite Index (IHSG) hit a new record high at 5.592.51 points, one day after Indonesian markets had been closed for a public holiday. Not only Indonesia but most Asian stocks rose on Wednesday - in line with expectations - following Wall Street higher overnight where the Trump stock rally seems back on track, especially after positive new economic data.

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Statistics Indonesia (BPS), a non-departmental government institute, expects that Indonesia's trade balance will post a deficit of around USD $4 billion in 2014. The key question is whether increased manufacturing and agricultural exports can replace reduced raw mineral exports. The forecast of BPS is approximately similar to the country's trade deficit in 2013. Last year, Southeast Asia's largest economy recorded a deficit of USD $4.06 billion as the total value of exports amounted to USD $182.57 billion, while imports reached USD $186.63 billion.

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As companies' financial results of 2013 slowly start to be released, two reports - so far - have raised eyebrows due to significant declines in net profit. These are publicly listed, but majority state-owned, airline Garuda Indonesia and fully state-owned electricity firm Perusahaan Listrik Negara (PLN). Both companies felt the impact of the sharply depreciating Indonesia rupiah exchange rate. The currency fell over 21 percent against the US dollar in 2013 due to capital outflows amid looming US tapering and current account deficit concerns.

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Domestic sales of motorcycles in Indonesia fell 11 percent to 580,288 units in January 2014. The main reason for this decline in the first month of the year were severe floods brought about by high rainfall amid a peak of the rainy season. These weather conditions disrupted the distribution of motorcycles from factories to dealers. As a result, all motorcycle brands recorded lower sales figures according to data released by the Indonesian Motorcycle Industry Association (Aisi). However, more factors were at play.

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ICRA Indonesia, an independent credit rating agency and subsidiary of ICRA Ltd. (associate of Moody's Investors Service), publishes a monthly newsletter which provides an update on the financial and economic developments in Indonesia of the last month. In the January 2014 edition, a number of important topics that are monitored include Indonesia's inflation rate, the trade balance, the current account deficit, the IDR rupiah exchange rate, and gross domestic product (GDP) growth. Below is an excerpt of the newsletter:

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On Wednesday (05/02), Statistics Indonesia (BPS) reported that the economy of Indonesia expanded 5.78 percent in 2013. This result implies that in 2013 Indonesia experienced the slowest pace of GDP growth since its 4.63 percentage growth in 2009. However, this slowing growth was basically self-inflicted as both the Indonesian government and central bank (Bank Indonesia) used various monetary and fiscal policies to curb economic expansion in order to tackle several financial issues.

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Despite higher car prices due to the depreciating rupiah exchange rate, domestic car sales in Indonesia rose 11 percent to 107,496 in January 2014 compared to the same month last year. January sales were particularly supported by sales of the low cost green car (LCGC) and low multipurpose vehicle (LMPV). Both these car types enjoy high popularity in Indonesia. In 2013, the Indonesian government provided tax incentives for the establishment of a domestic LCGC industry.

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In the last month of 2013, Indonesia's trade balance posted a surplus of USD $1.52 billion, almost twice as high as economists had previously predicted. The December surplus implied Indonesia's third consecutive monthly trade surplus and fifth monthly trade surplus in full year 2013. However, considering the whole year, the trade balance still posted a deficit of USD $4.06 billion in 2013 as the total value of exports amounted to USD $182.57 billion while imports reached USD $186.63 billion.

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Despite the release of positive macroeconomic data on Monday (03/02), Indonesia's rupiah exchange rate depreciated 0.22 percent to IDR 12,240 per US dollar based on the Bloomberg Dollar Index. China’s Manufacturing PMI fell to a six-month low of 50.5 in January and put pressure on stocks and currencies in emerging markets. Moreover, the Federal Reserve's further reduction of its quantitative easing program (to USD $65 billion per month) continues to strengthen the US dollar at the expense of emerging currencies.

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On Wednesday 5 February 2014, Statistics Indonesia (BPS, a non-departmental government institute) is expected to release Indonesia's official GDP growth figure for the year 2013. It is estimated that the outcome will be the lowest GDP growth figure since 2009 when Southeast Asia's largest economy grew 4.6 percent after feeling the impact of the global financial crisis. In 2013, again, Indonesia felt the negative influence of external troubles. And in combination with domestic factors, Indonesia's economic growth is expected to be around 5.7 percent in 2013.

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In the Bloomberg Dollar Index, Indonesia's rupiah exchange rate depreciated 0.47 percent to IDR 12,238 per US dollar on Monday (27/01). The decline of the rupiah was in line with today's trend of weakening Asia Pacific currencies (against the US dollar). Meanwhile, the central bank's mid rate (the Jakarta Interbank Spot Dollar Rate or JISDOR) depreciated 0.17 percent to IDR 12,198 per US dollar. Market participants are concerned about Indonesia's January 2014 inflation and further Federal Reserve tapering.

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