21-11-2023 (JAKARTA) Indonesia reported a current account deficit of $0.9 billion in the third quarter, equivalent to 0.2% of the gross domestic product (GDP), according to a statement from the central bank on Tuesday. This marked a significant reduction from the previous quarter, primarily attributed to the resurgence in demand for certain export commodities.
In the second quarter, Southeast Asia’s largest economy experienced a $2.2 billion current account deficit, equivalent to 0.6% of GDP. This marked the first quarterly deficit in two years, based on revised data from Bank Indonesia (BI).
The decline in Indonesia’s monthly trade surpluses this year was influenced by the weakening prices of key commodities such as coal and palm oil compared to the previous year.
Bank Indonesia stated that the diminished current account deficit in the third quarter was supported by the recovery in the trade of goods. Demand for steel and iron increased amid weakening global commodity prices, contributing to the improved economic balance.
The deficit in the services sector also saw a decrease during the third quarter, driven by the recovery in the tourism sector post-pandemic, as mentioned by BI.
The balance of payments for the July-September quarter stood at a deficit of $1.5 billion, a notable improvement from the $7.4 billion deficit recorded in the preceding three months.
Bank Indonesia has provided a forecast for this year’s current account, estimating it to range between a surplus of 0.4% and a deficit of 0.4%.
