Almost like business as usual
In writing this report, it was interesting to note that the data presented, the trade balance as well as the inflation figures, did not show anything unusual. Exports registered another increase in August 2025, while the trade balance reported a larger surplus than the previous month. At the same time, the inflation data showed a mild increase in the month of September, but still within the safe corridor set by the Central Bank.
As reported last month, Indonesia witnessed a changing of the guard in the Finance Ministry, from Sri Mulyani Indrawati as the previous Minister of Finance to Purbaya Yudhi Sadewa as the new one. The two ministers differ significantly in their approach as well as in their attitude. Sri Mulyani Indrawati was known as a conservative Finance Minister who guarded the country’s finances tightly, while the new Minister is a bit unorthodox. For example, he pumped up the liquidity of the state banks by moving funds from Bank Indonesia to the state banks. However, as time has gone by, people are becoming more appreciative of his actions, for example, when he visited the two state banks’ headquarters, as well as the tobacco industry in Central Java, and also his response to critics in the Indonesian Parliament.
From his actions of the past month, I have higher hopes that he will bring good initiatives to the country. The least I can do is give him the benefit of the doubt until the end of this year before making any early judgments of the new minister.
As mentioned earlier, the Central Board of Statistics in Indonesia released its balance of trade report for the month of August 2025, which showed a higher surplus than the previous month. The surplus in August stood at $5,488 million compared to $4,173.5 million achieved in July. The total trade surplus for January-August 2025 stands at $29,140.1 million, 34.77% above the $19,007.3 million achieved in the same period of the previous year. Exports in August 2025 reached $24,963.2 million, while imports in that month were $19,475.2 million. Cumulative exports from January to August 2025 reached $185,125.9 million, while cumulative imports for the same period reached $155,985.8 million.
The Central Board of Statistics also reported the Consumer Price Index for September 2025, which showed inflation of 0.21%. With that monthly inflation, Y/Y inflation reached 2.65%. At its policy meeting held on September 16-17, 2025, the Central Bank of Indonesia decided to reduce the benchmark rate by 25 basis points to 4.75%.
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