Indonesia’s Retail Sales Trends and Consumer Outlook Signals a Bleak Economic Recovery

Bank Indonesia (BI) announced that the country's retail sales in July 2020 had fallen 12.3% year-on-year (YoY) due to continuing consumer pessimism, as indicators point to a weak economic recovery in the third quarter of 2020 (3Q 2020). However, the contraction was lower than the 17.1% YoY decrease in June 2020, according to BI, with retail sales in August 2020 estimated to contract 10.1% YoY.

BI's consumer confidence index (IKK) survey, found that public confidence in Southeast Asia's largest economy was significantly damaged by layoffs in the wake of the COVID-19 crisis. An index value over 100 IKK indicates general consumer optimism whilst a value below 100 indicates pessimism.

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