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Developments in Monetary Sector 2013:Q4
As a consequence of weakening economic growth, the volume of money in (M2) circulation in broad sense also showed a decline. M2 growth in October 2013 slowed to 13.02% (y-o-y) from 14.57% (y-o-y) in the previous month. On the contrary, growth in M1 increased to 10.48% (y-o-y) from 9.08% (y-o-y) in the previous month.
Figure 4: Money Supply, 2011 – 2013* (in IDR Trillion)
Growth in M2 showed declined in October 2013, conversely, MI growth higher compared with the previous month. 
Source: Bank Indonesia and CEIC (2013)
*= October 2013
Latest Economic Developments 2013:Q4
Indonesian economic growth in the third quarter slowed. This is line with predictions of GAMA Leading Economic Indicator which was generated on the basis of analysis of the Macroeconomic Dashboard team. Consensus results predicted that Indonesian economy would register the growth rate of 5.57% ± 0.28% in the quarter III-2013. The accuracy of GAMA LEI’s prediction and result of the Macroeconomic Dashboard consensus were very much in line with statistics released by the National Bureau of Statistics that showed Indonesian economic growth to have grown by 5.62% (y-o-y) in the quarter III-2013, which was lower than 5.83% (y-o-y) posted in the quarter II-2013.
Indonesia faces an overhang of Crisis “Syndrom”
Indonesia faces an overhang of Crisis “Syndrom”
By: Prof. Tri Widodo, Ph.D
Are there any reasons for anybody to countenance the possibility of a new chapter of the economic crisis in Indonesia? Three macroeconomic issues that are worth serious attention in relation to latest developments in Indonesia economy. The list includes economic growth, unemployment and stabilization.
Economic growth that has weakened
Economic growth registered in the last three quarters attest to a weakening economy. The target set for economic growth in the revised annual budget 2013 was 6.3% , which in all likelihood will be difficult to achieve. Bank Indonesia (2013) and BPS (2013) indicate that conditions over the last two quarters pointed to economic growth of 5.8%. The implication of that is clear, for according to Okun’s law, low economic growth means that the economy has limited capacity to absorb employees. Apparently, the trickle-down effect from macroeconomy that posts growth of 5.8% , does not have ample capacity to absorb employment, “the state of microeconomy does not have as much spackle as the macroeconomy” due to structural weaknesses, such as competitiveness of manpower, infrastructure and so on.