Financial News: Indonesia GDP Growth Fastest In 2 Years

Indonesia GDP Growth Fastest In 2 Years

08/05/2025 - 03:17:00 (RTTNews)

(RTTNews) - Indonesia's economic growth accelerated the most in two years in the second quarter driven by household spending and investment, official data showed Tuesday.

Gross domestic product expanded 5.12 percent year-on-year in the second quarter, following an annual growth of 4.87 percent seen in the first quarter. The latest expansion was the fastest since the second quarter of 2023.

On a quarterly basis, GDP rebounded 4.04 percent, reversing a fall of 0.98 percent in the first quarter.

The expenditure-side of GDP showed that household spending advanced 4.97 percent from the previous year, while government spending fell 0.33 percent. Gross fixed capital formation expanded 6.99 percent.

Exports of goods and services moved up 10.67 percent and imports climbed at a much faster pace of 11.65 percent.

Last month, Indonesia finalized a trade deal with the U.S., ending months of uncertainty over future tariffs. The U.S. reduced the proposed tariff on imports from Indonesia to 19 percent from 32 percent.

In July, the Bank Indonesia had lowered its benchmark interest rate for the third time this year to support economic growth amid slowing inflation. The key BI rate was lowered by 25 basis points to 5.25 percent.

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