Indonesia expects to see higher growth in the first quarter this year on the back of improving international trusts to the nation's economy and low volatility after the Fed's rate benchmark hike, a senior economist said on Wednesday.
Indonesia's central bank (BI) Deputy Governor Sugeng said that the improving international trusts to Indonesia's economy were partly seen from the increasing of Indonesia's sovereign bond ratings from stable to positive recently awarded by prominent agencies, including Fitch and Moody's.
"Besides that, our currency is even strengthening after the Fed increased its benchmark rate recently. Investments influx increased apparently," he said.
BI kept its benchmark rate steady at 4.75 percent as the United Sates Federal Reserves increased its rate by 25 basis points earlier this month.
The central bank previously revised its first quarter growth estimate this year to 4.99 percent from the initial 5.05 percent due to low government spending.
Indonesia recorded a 4.94 percent growth in the fourth quarter last year. The Southeast Asia's largest economy posted 5.02 percent growth last year.
The nation has the potentialities to spur its growth up to 5.2 percent this year, according to the World Bank (WB).
Indonesian government has revised its growth target this year to 5.1 percent from 5.3 percent due to the global downturn.
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