Indonesia Macro Update - Trade Balance 15 Jan 2024
KBVS TRADE BALANCE UPDATE
Monday, 15 January 2024
Improving Trade Surplus and Strengthening Rupiah Amid Rising Geopolitical Risks
Indonesia's trade surplus in Dec '23 increased to USD3.30 bn (Cons: USD1.92 bn, KBVS: USD3.07 bn, Prev: USD2.41 bn). The increase in the Dec '23 trade surplus was driven by the growth in the Non-Oil and Gas sector surplus, reaching USD5.20 bn (prev: USD4.62 bn), accompanied by a decline in the Oil and Gas sector deficit to just USD1.89 bn (prev: USD2.21 bn). On the import side, the largest increase came from the Mineral Fuels (HS27) +89.80% MoM.
Looking ahead, we anticipate that the 1.89% MoM increase in exports in Dec '23 will continue, in line with the Manufacturing PMI of key trading partners, especially China and export improvement from Palm Oil. Simultaneously, we observe the possibility of a decline in export and global supply chain activities, particularly between Asia-Africa and Asia-Europe, amidst increasing geopolitical tension in the Middle East since early 2024. Additionally, the rise in imports of consumer goods is a concern in Jan '24, given the front-loading activities by businesses ahead of the upcoming Ramadan season starting in the second week of Mar '24 and Eid, approximately 30 days thereafter.
Regards,
Fikri C Permana - KBVS Research Team