Indonesia’s economy expanded more than forecast in the second quarter as domestic demand likely remained strong.

Gross domestic product rose 5.05% in the April-June period from a year ago, the statistics office said on Monday. That was faster than the median 5% increase forecast in a Bloomberg survey of economists and compares with the 5.11% growth reported in the first quarter.

GDP grew 3.79% on a quarter-on-quarter basis, faster than the 3.72% forecast.

The stronger growth print - the third straight quarter of above 5% expansion for Southeast Asia’s largest economy - underlines the resilience of household consumption amid still-high borrowing costs and ongoing external headwinds. Improving exports and fiscal stimulus also helped support consumer spending.

That could support the central bank in keeping interest rates steady for a while to preserve currency stability, before pivoting to monetary easing later this year or next year.

The latest reading also puts the nation on track with its full-year GDP growth target of 5.2%. The government sees solid domestic demand, capital spending and exports to continue supporting the economy for the rest of 2024.

  - Bloomberg