Airlangga Reveals Temporary Nature of Weakening Economic Indicators, Quarter III is Projected to Improve

Coordinating Minister for the Economy Airlangga Hartarto (center)

JAKARTA - The government assesses that Indonesia's economic fundamentals remain strong despite a number of economic indicators showing weakness, ranging from manufacturing activity, trade balance, to consumer confidence levels.

Based on the latest data, the Consumer Confidence Index (CCI) in June 2026 fell to 117.8 from 120.9 in May 2026, and this decline was the third in a row and the lowest level since September 2025.

In the industrial sector, the Indonesian Manufacturing Purchasing Managers' Index (PMI) also returned to the contraction zone after falling to 46.9 in June 2026.

Meanwhile, on the external side, Indonesia's trade balance recorded a deficit of US$1.61 billion in June 2026, and the achievement was the first monthly deficit since 2020.

However, Coordinating Minister for Economic Affairs Airlangga Hartarto assessed that the weakening of these various indicators was still within reasonable limits and was believed to be temporary.

According to Airlangga, the decline in IKK has not significantly reflected a decline in public confidence in the economy because the index is still above the 100 level which indicates that consumer optimism remains maintained.

"IKK above 100 is still safe, yesterday (March) there was Eid (so it went up), after Eid it must have gone down a little," he told the media, Friday, July 10.

He is also optimistic that the performance of a number of economic indicators will improve again in the second half of 2026, especially in the third and fourth quarters.

"Later we will see that by the third quarter, the fourth quarter will rise again (exports and manufacturing PMI)," he said.