22 Mei 2023 | News & Feature

A budget full of confidence

  • The government remains optimistic about the Indonesian economy in 2024, setting a GDP growth target of 5.3-5.7%. This target contrasts with the gloomy global economic outlook and the government's inflation target of 1.5-3.5%
  • The government's GDP and inflation targets reflect their belief that the global economy will experience significant challenges in 2024, while domestic factors such as household consumption and private investments will be sufficient to drive the economy towards another above 5% growth.
  • The government is proposing a less-expansive fiscal budget despite the ambitious GDP growth target. This approach may provide room for Bank Indonesia to implement a more accommodative monetary policy, although any changes are not expected in the short term due to moderating expectations regarding the Fed's policy shift.