Research

Indonesia: Weak Consumption & Income

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Algo Research Team

Economics | Feb 27, 2023 | Views: 153

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Key Summary:

  • GDP growth likely less than 5% in 2023
  • A combination of rising inflation, lower income is eroding purchasing power
  • Stagflation for the majority, excess for the rich

We maintain our view that the Indonesian equity market is generally lacking catalysts and is likely going to be a bearish to neutral year for now with volatile trading range. On this note, we think Indonesia GDP will grow <5% as the growth drivers of last year will likely start to slow and become headwinds in 2023 and it will be more distinct in our consumption as it faces challenges from declining income and purchasing power going into the year.



Declining income & consumption

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