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Emerging markets in trouble, but Indonesia not so much: Moody's Analytics
Although the global economy is in troubled waters, Indonesia's economy is buoyed by strong commodity exports, putting the country in a favorable position among emerging markets, research by Moody’s Analytics suggests.
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Workers carry sacks of fish feed at the Cirata Reservoir in Cianjur, West Java, on May 7. (AFP/Adek Berry )
A
lthough the global economy is in troubled waters, Indonesia’s economy is buoyed by strong commodity exports, putting the country in a favorable position among emerging markets, research by Moody’s Analytics suggests.
“The labor market in the emerging world remains an open wound,” according to Moody’s Analytics report, “Emerging Market View: The Growth Recession”.
After the GDP grew for most of the emerging-market world in a stronger-than-expected first quarter, “the day after isn’t looking so great,” says the financial-services company in a press release on the report published on Monday.
The latest figures on global trade, major-economy factory orders and consumer and business sentiment all pointed to trying times for emerging economies, according to the analysts, noting that inflation was rising and would prompt a response by central banks.
Not all emerging economies are facing the same problems, however.
Moody’s Analytics singled out Indonesia among the “very few in which high commodity prices will make up for what inflation stands to take away”. The other three mentioned are Malaysia, after Indonesia the largest crude palm oil (CPO) exporter, as well as oil-rich Saudi Arabia and Colombia.
