Growth remains robust
The Indonesian economy as reported by the Central Board of Statistics grew by 5.04% in Q3 2025. The rate of growth remained robust due to strong private consumption and exports. Exports grew by 9.91%, supporting the regions with strong export activity. For industrial products, the main export activities took place in Java, while for commodities, including processed products such as iron and steel, export activities were concentrated outside Java.
While not the highest growth by sector, the manufacturing sector expanded 5.40% during Q3 2025, higher than the overall rate of growth of the economy of 5.04%. Therefore, the contribution of the manufacturing sector to economy's rate of growth was higher than in the previous period. Thus, the industrialization process in Indonesia has begun to climb again.
The Central Board of Statistics also reported the trade balance for September 2025, which registered yet another large surplus at $4,343.8 million. While below the surplus in August by $1,144.2 million, it was higher than that of September 2024 by $1,167.1 million. In September, exports reached $24,679.1 million, down 1.14% month over month, but up 11.41%. year over year. At the same time, imports reached $20,335.3 million, up by $860.1 million or 4.41% month over month. Most of the increase was seen in the capital goods sector, likely supporting investment activity.
In October 2025, M/M inflation reached 0.28%, leading to a Y/Y rate of 2.86%, which was above the 2.65% Y/Y level of the previous month. While that level of inflation is in the upper part of the target inflation corridor, inflation remained benign. With that development, Bank Indonesia decided to keep the benchmark interest rate constant at 4.75% at its meeting of October 21-22, 2025.
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