JAKARTA — Indonesia’s economic growth surprisingly picked up in the second quarter of this year, fueled by easy credit and strong domestic demand, a sign that Southeast Asia remained resilient amid the global slowdown.
Most economists say they expect the central bank to keep interest rates on hold at a record low into next year to drive growth, although some analysts caution that tighter policy might be needed beyond that to dampen domestic demand.
The Indonesian economy is growing faster than other major emerging- market economies except for China’s, leading some analysts to view the country as a worthy contender to join the BRICSgrouping, which includes Brazil, Russia, India and South Africa, as well as China.
The country’s statistics bureau said gross domestic product last quarter had grown 6.4 percent from the same period a year earlier, compared with 6.3 percent in the first quarter, helped by domestic consumption and investment. G.D.P. grew 2.8 percent on a quarterly basis, although the figures are not seasonally adjusted.
The strong second-quarter growth “provides a cushion against the risk of further growth setbacks in the rest of the year,” said Aninda Mitra, an economist at ANZ Bank in Singapore.
Economists had forecast that annual growth in Indonesia, which has the largest economy in Southeast Asia, would ease to 6.1 percent, citing shrinking exports.
Financial markets provided little reaction to the data, which showed that buoyant domestic demand, especially in transportation, hotels and government consumption, had kept growth on an even keel.
Thailand and Malaysia should also post pickups in economic activity in the second quarter versus the first quarter, analysts have said. Investors are pouring into Southeast Asian stock markets, with exchanges in Bangkok, Ho Chi Minh City, Manila and Singapore all seeing double-digit gains this year. Investors are betting on long-term growth. The economic forecasting firm IHS Global Insight forecasts that the region’s G.D.P. will overtake Japan’s by 2028.
As demand from China and Europe has fallen in recent months, Indonesia has had consecutive trade deficits between April and June, weighing on the rupiah. The April deficit was the first since mid-2008, barring a small shortfall in July 2010, Thomson Reuters data show.
The currency has fallen 4.4 percent against the dollar this year.
A burgeoning appetite for imports as varied as wheat, iPads and luxury cars, in a country that mostly exports raw commodities like coal and crude palm oil, created a $1.3 billion trade deficit in June — a deficit economists see continuing to keep pressure on the rupiah until the end of this year.
Transportation and communications was the fastest-growing sector in the first half of the year, up 10.1 percent in the second quarter from the same period a year earlier. Luxury-car sales are booming as growing wealth leads drivers to upgrade from Toyotas to BMWs, while young consumers are snapping up smartphones.
The trade, hotel and restaurant sector grew faster in the second quarter, with the world’s fourth-largest population increasingly flying on new airline routes to stay at branded budget hotels. In Jakarta, trendy new eateries open regularly, while convenience stores are spreading across the country.