Bank Mandiri Economist Projects Economic Growth In The Third Quarter Of 2025 Of 5.05 Percent

Rupiah (Photo: antara)

JAKARTA - Bank Mandiri Chief Economist Andry Asmoro estimates that Indonesia's Gross Domestic Product (GDP) will grow by 5.05 percent year-on-year (yoy) in the third quarter of 2025. This figure is slightly reduced when compared to 5.12 percent (yoy) in the second quarter of 2025, but still higher than the growth of 4.95 percent yoy in the third quarter of 2024.

"The growth is estimated to be supported by strong household spending and improved external performance, despite slowing investment and government spending as a limiting factor," he said in an official statement, Tuesday, November 4.

Andry explained that household consumption is predicted to be stable at 5.0 percent (yoy), the same as the previous quarter. This is in line with the increase in retail sales growth to an average of 4.7 percent (yoy), up from 0.9 percent in the second quarter of 2025.

"Supported by retail sales growth with an average of 4.7 percent yoy, up from 0.9 percent in the second quarter of 2025, reflecting domestic demand maintained amid controlled inflation," he said.

On the other hand, Andry projects investment activities will slow down to 4.5 percent yoy in the third quarter of 2025, down drastically from 7.0 percent yoy in the second quarter of 2025.

Meanwhile, investment activity is projected to slow down to 4.5 percent (yoy) in the third quarter of 2025, down from 7.0 percent (yoy) in the previous quarter. This slowdown was reflected in the contraction in cement sales of 2.3 percent compared to the second quarter of 2025 2.7 percent, and the weakening imports of capital goods from 32.5 percent to 10.4 percent.

According to Andry, this shows the normalization of investment after high growth in the previous quarter.

However, he conveyed that the increase in the average manufacturing Purchasing Managers' Index (PMI) to 50.4 from 47.0, in line with the Bank Indonesia Business Activity Survey report which recorded an increase in production capacity, could slightly withstand the slowdown in investment.

In addition, government spending is also estimated to contract to 2.5 percent (yoy) in the third quarter of 2025, or lower than in the second quarter of 2025 of 0.3 percent. This decline is in line with the decline in fiscal spending flow by 2.9 percent (yoy).

"The central government's spending also contracted by 5.1 percent yoy, showing measurable budget realization," he said.

On the trading side, Andry estimates export growth will increase to 11 percent (yoy) in the third quarter of 2025, slightly higher than 10.7 percent in the previous quarter. On the other hand, imports are predicted to slow sharply to 3.2 percent (yoy), down from the second quarter of 2025 at 11.7 percent.

"This condition is expected to increase net export contribution, supporting overall GDP growth even though global trade is still vulnerable," he said.