Barclays: Indonesia's economic growth may slow to 4.8% in 2025

Barclays economists Brian Tan and Hongying Liu stated in a report that due to government spending freezes, weak investment, and tariff challenges from the United States, Indonesia's economic growth rate may slow from 5.0% last year to 4.8% in 2025. They pointed out that fiscal delays could lead to stagnation in government spending. They believe that if the Indonesian rupiah remains stable, the Bank of Indonesia may cut interest rates by 25 basis points at the May meeting. Barclays maintains its baseline forecast of four more rate cuts by early 2026, each by 25 basis points. Against the backdrop of weakening domestic demand and external trade risks, the demand for policy support is increasing. The current benchmark interest rate of the Bank of Indonesia is 5.75%