The Indonesian economy in 2019 "There are still many surprises"

JAKARTA, KOMPAS.com – The chief economist of PTB CIMB Bank, Niaga Tbk, Adrian Panggabean, said that the Indonesian economy next year will be a surprise and a challenge, both from internal factors and external.

"The surprise will still occur in 2019, there is an Iranian problem with Saudi Arabia because of oil.The oil prices are now due to geopolitical battles, all of which caused a change in geopolitics in Europe and the tension between the United States and China through the trade wars will continue over the next year "Adrian Graha CIMB Niaga Jakarta, Wednesday (28/11/2018).

Other global factors that influence interest rates are the United States (US) or the FF (Fed Fund Rate), which, according to Adrian, will increase another two to three in 2019.

"The average can increase three times, twice in the first half of 2019 and once in the second half of 2019," he said.

Also read: 2019, CIMB estimates Indonesia's economic growth at 4.9%

The global dynamic will also automatically lead to a continuous rotation among badet clbades, which will affect the continued shift in the global exchange rate market balance. The government must therefore react by adjusting its fiscal, monetary and commercial policies.

"The hope is of course that the attractiveness of the national financial market is maintained," added Adrian.

In addition, if the FFR increases and the conditions of the deficit of the current account (current account deficit/ CAD) Indonesia has not improved significantly, so that the Central Bank of Indonesia (BI) could raise its policy rate from 6.5 to 6.75%.

In 2018, BI raised the reference rate of the 7-day SP (BI 7-DRRR) benchmark (175bp) (from May to November 2018). As a result, the government should take various measures to protect this DAC.

Adrian said one solution was to reprogram (reschedule) against a number of infrastructure projects.

"I see that the Canadian dollar in 2019 is expected to be lower than 2018. The Canadian dollar is expected to account for about 2.5% of gross domestic product (GDP)",

Also read: BI expects the trade deficit to be less than 3% this year

Referring to the prospect of the Canadian dollar and global factors, including the stability of the US dollar (US) index and the prospect of a depreciation of the yuan, Adrian has estimated that the trading range the rupee in 2019 would be at 14,400 rupees / 15,200 rupees per US dollar.

However, Adrian also recalled that the difficult economic momentum was not to be feared.

"Behind this volatility is still there opportunity"Therefore, all economic players must be cautious, as must the formulation of appropriate and forward-looking policies by economic decision makers to face the challenges of the economy in 2019," he said.