The Permata Institute for Economic Research (PIER) projects Indonesia's Gross Domestic Product (GDP) growth for Q3-2025 at 5.04 percent, slowing from 5.12 percent in the previous quarter. This forecast indicates growth remains above 5 percent despite slowdowns due to political uncertainty. The Central Statistics Agency (BPS) will release official data on November 5, 2025.
Permata Bank through the Permata Institute for Economic Research (PIER) estimates Indonesia's GDP growth for Q3-2025 slightly above 5 percent, at 5.04 percent year on year (yoy). This marks a slowdown from 5.12 percent in Q2-2025. Faisal Rachman, Department Head of Macroeconomic and Financial Market Research at Permata Bank, stated, “We project Indonesia's GDP growth to weaken from 5.12 percent year on year (yoy) in Q2 to 5.04 percent (yoy) in Q3-2025.”
The slowdown is mainly due to weakening household consumption from political uncertainty at the end of August 2025, which pressured consumer confidence, and normalization of gross fixed capital formation (PMTB) amid slowing capital goods imports. However, export growth remains solid, supported by increased US demand until August 2025 and a surge in foreign tourists during the summer holiday season. Import growth is projected to decline with slowing PMTB activity and reduced service imports after the end of school holidays and the Hajj pilgrimage period.
Overall, the growth rate remains higher than Q1 and the first half of 2025, signaling an improvement in economic direction. For the full year 2025, PIER projects GDP growth in the range of 5.0-5.1 percent, compared to 5.03 percent in 2024. Faisal added, “This is an upward revision from our previous projection estimating growth slightly below 5 percent.” The forecast is supported by government policies oriented toward growth.
PIER assesses that economic prospects still face challenges, emphasizing the need to maintain expansionary policies through accelerated government spending in sectors with high multiplier effects. For 2026, external risks such as trade wars, geopolitical tensions, and slow recovery in China persist, though global stagnation may contain inflation and allow for further interest rate cuts. Domestically, political stability is a key factor, with warnings to balance growth and macroeconomic stability amid potential widening of the current account and fiscal deficits.