Indonesian growth slipped below six percent last quarter as exports and investment fell in Southeast Asia’s top economy due to global weakness, official data showed on Friday.
The rupiah is set for the worst monthly performance since February 2009 after the central bank allowed the currency to weaken to reflect the nation’s current-account shortfall. Government bonds fell. – Indonesian exports fell for 15 straight months through June as coal, palm oil and tin prices plummeted, contributing to a current account that has been in deficit for six quarters through March.
The figures highlighted the challenge for policymakers as they seek to maintain strong growth while battling a surge in inflation sparked by a fuel price hike and stopping recent steep falls in the rupiah, AFP reported.
The country’s trade deficit also widened to $850 million in June from $590 million in May as weak global demand weighed on exports, the agency said.
The central bank has hiked the benchmark interest rate at its past two meetings by a total of 75 basis points to 6.50 percent as it seeks to keep inflation in check.