Standard Chartered raises 2026 GDP outlook to 5.3% after stronger-than-expected H1 performance despite lingering headwinds.
Indonesia’s economy expanded 5.3% year-on-year in the second quarter, decelerating from 5.6% in Q1 but exceeding market expectations of 5.1%. The slowdown reflects fading one-off factors like Eid spending and harvest season gains, though growth remains above 2025 levels.
Formal-sector employment recovery remains weak, with such jobs declining to 40.7% of total employment from 42.3% in late 2025. Private-sector investment also remains cautious, offsetting gains from government programs and household consumption.
Standard Chartered revised its 2026 GDP forecast upward to 5.3% from 5.2%, citing stronger-than-anticipated first-half performance. The bank expects growth to average 5.2% in the second half, supported by social spending and infrastructure projects.