The Indonesian financial market has apparently ignored the terrorist bombing attacks that rocked the JW Marriott and Ritz Carlton hotels in Jakarta on Friday, killing nine and injuring more than 50 people, including foreigners.

It is also unlikely that Indonesia’s economic fundamentals will suffer a severe loss. As was the case following the four previous major terrorist attacks in Bali and Jakarta between 2002 and 2005, only the tourism and travel industries will likely feel a temporary shock.

But anyway, international tourism has been weakening since the outbreak of the global financial crisis and sharp economic downturn since last July.

The financial market is usually the most vulnerable to uncertainty because portfolio investors can easily move their money from one place to another, so it is really encouraging that the market has remained fairly calm.

But whether the financial market would continue to see the latest bombings as an isolated incident after four years of peace without any terrorist attacks, will depend on the speed and credibility with which the government can resolve these terrorist threats.

We therefore agree with the expectations of most analysts that the national economy will continue to grow at least by 4.5 percent throughout this year on the back of robust private consumption, compared to deep contractions in most other countries, including our neighbors such as Singapore, Thailand and Malaysia.

The economy expanded by 4.4 percent in the first quarter, as domestic consumption got a boost from massive spending on political campaigning for the April legislative election. We believe the growth continued at an annual pace of 4.5 percent in the second quarter, also partly due to big political spending for the July 8 presidential election.

Indonesia’s US$454 billion economy may continue to expand at a similarly respectable pace in the third quarter, as private consumption enjoys its seasonal boost during the Islamic fasting month in August and Idul Fitri celebrations in September.

The pace of growth may even accelerate in the last quarter on the back of both private and government consumption because more than 60 percent of the annual government investment budget usually is spent between October and December.

However, this rosy outlook could evaporate if terrorists succeed in staging another major bomb attack somewhere in the country within the next few months, because such an incident would strike at the very foundation of investment — security and safety.

Barring another major terrorist bomb attack within the next few months, the economic outlook will be influenced more by the credibility of the presidential election, the quality of the new Cabinet to be formed later in October, and institutional capacity to speed up budget disbursement and infrastructure development.

If the final results of the presidential election, scheduled to be announced by the General Elections Commission later this week, are perceived to be less credible or marred by too many major disputes, the political stability may get a severe jolt at the big expense of economic fundamentals.

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