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GAMA Leading Economic Indicator and Economic Outlook 2014:Q1
1. GAMA Leading Economic Indicator (GAMA LEI)
GAMA Leading Economic Indicator (GAMA LEI) is a model, which was developed by Macroeconomic Dashboard team, of FEB, UGM, which has the ability to undertake state of the art forecasting. Prediction results generated by GAMA LEI model have the ability to predict the direction of movements of Indonesian economy in future long before the event. The prediction of the direction of movement of Indonesian economy is done by observing the movement or change in direction, which is produced by the GAMA LEI model for a certain period of time. GAMA LEI is compiled on the basis of stringent quantitative and qualitative tests and using a selection of certain variables, deemed to have the ability to produce the best prediction.
Developments in Government Finances and Fiscal 2014:Q1
As per January 2014, revenue and grant realization had reached 5.5% of the target of IDR 1,667.1 trillion set in the state budget 2014, while government expenditure realization was 5.3%. Target of revenue and grants consist of IDR 1,665.78 trillion and IDR 1.36 trillion, in domestic revenues and grants, respectively. To date, tax revenues have reached 6.5% of the target set in state budget 2014 of IDR 1,280.4 trillion, were just 2% of the target of IDR 385.4 trillion. Total government expenditure in state budget 2014, is set at IDR 1,842.5 trillion, which comprise IDR 1,249.9 trillion in central government expenditure and IDR 592.6 trillion in regional government transfer. By January 2014, realized central government expenditure has reached 3.2%, while transfer local governments was 9.6%. Debt repayment and social contributions constitute the largest percentage of realized government expenditure, registering 10.8% and 10.1%, respectively.
Developments in Monetary Sector 2014:Q1
Rupiah Continues to Depreciate
High inflationary pressure in Indonesia is often attributable to non-monetary factors such as poor infrastructure, floods, and natural disasters. Such events have often ended up sending prices of food prices higher, which in turn fuels inflation. Inflation in January 2014 rose sharply compared to the position in December 2013 (8.08%, y-o-y). Besides, the increase in prices of commodities that are under government direction and control—such as the increase in liquefied petroleum gas which occurred at the beginning of the year—also contributed to the drastic rise in inflation.