UI Economist Predicts Economic Growth In Quarter I Less Than 5 Percent

Illustration (Photo: Doc. Ministry of Finance)

JAKARTA Economic observer from the University of Indonesia's Institute for Economic and Community Research (LPEM) Teuku Riefky assesses that economic growth in the first quarter of 2023 will not touch the psychological level of 5 percent.

According to him, this condition cannot be separated from the various pressures that are still happening today, especially in terms of inflation and global stagflation potential.

"The prediction that we convey in this outlook for Indonesia's gross domestic product (GDP) in the first quarter of 2023 is 4.92 percent with a range of 4.89 percent to 4.95 percent," he said in a written statement on Thursday, May 4.

Riefky explained, in addition to the inflation and stagflation factors mentioned earlier, there is also the impact of the banking crisis that has recently occurred in the United States. This is based on the fact that several banks such as SVB, Signature Bank, and First Republic Bank have collapsed.

"This will also have an impact on developing countries such as Indonesia, which is related to banking crisis management in the country," he said.

However, Riefky is optimistic that the macro pace of the Indonesian economy will remain on track, which he calls 'Back to the Old Normal'.

"Our Forecast for Indonesia's full year 2023 GDP figure is 4.0 percent to 5 percent," he said.

For information, this press statement was released by LPEM UI as part of the dissemination of information ahead of exposure to economic growth by the Central Statistics Agency (BPS) on Friday, May 5, 2023.