- Elevated oil prices and stalled peace process are increasing stagflationary risk across the region, with Indonesia’s headline inflation shielded by subsidies are growing costlier by the day.
- Q1-26 growth is expected to remain resilient at 5.13-5.26% YoY, supported by strong Ramadan spending, fiscal acceleration, and continued investments toward gov’t programme.
- Factors that lifted Q1 will largely be absent Q2 onwards, with M2 growth fading, private loan decelerating, and fuel price adjustment seems inevitable, we revise our 2026 GDP forecast to 5.0-5.1% YoY.
