Indonesian trade balance likely to have recorded deficit in January, BI likely to stay on hold

Indonesian trade balance data is set to be released this week. According to a DBS Bank research report, the trade balance is likely to have come in deficit again in January at around USD 300 million. Growth in imports is expected to have remained strong at 19.4 percent year-on-year, owing to the rebound in investments in the economy.

Meanwhile, exports are expected to have grown 4.7 percent in January, below the imports growth. In the meantime, Bank Indonesia is expected to keep its key interest rates on hold this week. In spite of the consumer price inflation beginning this year comparatively weak at 3.3 percent in January, Bank Indonesia might continue to stress the need to stay cautious going forward, especially given the recent sharp correction in financial markets, stated DBS Bank.

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