August 6, 2026 | 03:43 pm
TEMPO.CO, Jakarta - Bank Indonesia (BI) has maintained its forecast for Indonesia's economic growth in 2026 at 4.9 to 5.7 percent, saying domestic demand is expected to remain the main driver of expansion, supported by government and central bank policies.
In a statement released on Wednesday, BI said the economy continued to grow in the second quarter of 2026, backed by stronger household spending, investment, and exports.
“From the expenditure side, economic growth in the second quarter of 2026 was supported by domestic economic activity,” BI Executive Director for Communications Ramdan Denny Prakoso said.
Household Spending and Investment Support Growth
Bank Indonesia reported that household consumption grew 5.06 percent year-on-year in the second quarter, supported by school holidays and national religious holidays.
Government spending rose 15.97 percent, driven by personnel expenditure, including the payment of the annual 13th-month salary for civil servants, as well as spending on goods and services for the government's Free Nutritious Meals (MBG) program.
Spending by non-profit institutions serving households increased 6.93 percent, while investment expanded 6.87 percent, supported by both public and private investment, including higher investment in vehicles.
Meanwhile, exports grew 4.13 percent, helped by stronger demand from Indonesia's major trading partners.
Manufacturing, Trade Lead Economic Expansion
BI said the manufacturing, wholesale and retail trade, construction, and information and communication sectors remained the largest contributors to economic growth.
The accommodation and food service sector also posted positive growth, supported by higher hotel occupancy rates and the expansion of the Free Nutritious Meals program to more beneficiaries.
Among Indonesia's regions, Bali and Nusa Tenggara recorded the strongest economic growth in the second quarter, followed by Java, Sulawesi, Sumatra, Kalimantan, and Maluku and Papua.
Bank Indonesia said it would continue coordinating its monetary, macroprudential, and payment system policies with the government to maintain economic stability while supporting sustainable growth.
The central bank has kept its full-year 2026 economic growth projection unchanged at 4.9–5.7 percent, citing resilient domestic demand despite ongoing global economic uncertainties.
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