Indonesian trade, inflation data show economy on the mend

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Indonesia has posted a robust monthly trade surplus while inflation eased in April, data showed Friday, in a sign Southeast Asia’s top economy is on the road to recovery.

The country was hit hard in 2013 as trade plunged to record deficit, the currency dived and inflation spiralled, but all three indicators have improved in recent months.

Trade stood at a surplus of $673.2 million in March — narrowing from the higher-than-expected $785 million posted in February thanks to a jump in palm oil prices and a slowdown in imports, but staying well out of trouble.

March exports rose 1.24 per cent year-on-year, while imports fell 2.34 per cent.

Inflation also eased in April to 7.25 per cent year-on-year from 7.32 in March as the price of gold fell and the harvest season boosted food supplies, statistics agency chief Suryamin, who goes by one name, told reporters.

David Chang, a director at UOB Kay Hian Securities in Jakarta, said there had been fears of economic instability in the run-up to Indonesia’s July 9 presidential election.

“But the easing of inflationary pressures mean we are unlikely to see a rise in interest rates, and the rupiah has strengthened, so the outlook is fairly positive,” Chang told AFP.

Economists have said, however, that the bank is unlikely to further loosen its stance as inflation is still well above its target range of 3.5 per cent to 5.5 per cent.

The signs of recovery follow a period of monetary tightening last year after a price hike in subsidised fuel triggered a spike in inflation and as the rupiah dropped, losing more than 20 per cent of its value by the year-end.

The central bank raised the benchmark interest rate by 1.75 percentage points from June last year, but has held it at 7.50 per cent since December.

Like many emerging economies, Indonesia was slammed last year by speculation the US Federal Reserve would start to wind down its stimulus programme, which had been credited with a rally in emerging markets since it was unveiled in late 2012.

The Fed began tapering its bond-buying in January and on Wednesday announced another widely-expected $10 billion cut to the programme.

 

 

 

Source : Channel News Asia | May 2, 2014

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About thomasdinnocenzi

Thomas D'Innocenzi is a highly accomplished, results-focused senior international executive with extensive experience in global sourcing and market development worldwide to meet evolving business needs. Tom has proven ability in implementing and managing profitable global sourcing operations worldwide. Extensive experience in international market development operations to accommodate rapid growth. Skilled in building top-performing teams, benchmarking performance, and restricting organizations to improve efficiency, productivity, and profitability. Experienced transition leader and change agent. As principal of Nova Advisors, LLC I’ve assembled an exemplary team that brings with them the knowledge and experience gained from starting up a Global Sourcing program with multiple Fortune 500 companies as well as the largest supplier network throughout the Asia-Pacific region. We have experience and expertise in more than a thousand medical and pharmaceutical products in manufacturing and sourcing at the best value. The right product, the right price point and the right branding fueled these successes that resulted in double-digit growth for top line sales and bottom line net margins for our customers. What sets us apart: • Our reach includes a large network of suppliers & manufacturers spanning 13 countries in Asia-Pacific region • We understand the manufacturing process and the business of the supplier and the buyer • Our company culture is based on quality assurance and our process is based on local quality control Our commitment is to be your partner offering the best products and services at the lowest cost. Contact me to discuss how we can make the global marketplace work for you. thomas@novaadvisors.com In addition, I am open to discussing opportunities in global sourcing, international marketing & sales, logistics and medical/pharma in Thailand, Vietnam, Malaysia, Philippines & Japan. Aside from my work I enjoy piano, astronomy, physics, and assisting my daughters with their studies. SPECIALTIES: Global Sourcing, Supply Chain Management, Business Development, Marketing, Logistics, Global Networking, Market Development, Healthcare Solutions, Pharmaceuticals, Medical Devices, Technology, Asia, Southeast Asia, US and Canada
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