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Jakarta Post

Current account deficit not always bad thing: Analysts

  • Rachmadea Aisyah

    The Jakarta Post

Jakarta   /   Tue, May 21 2019   /  12:07 am

The current account deficit is expected to widen in the coming months as the country’s trade deficit is likely to continue to increase, but a large current account deficit does not necessarily have to be translated as a bad omen for the economy, analysts have said.International ratings agency Standard & Poor’s (S&P) Global Ratings said while the current account deficit might appear worrisome, stakeholders should consider what actually negated the current account balance. Earlier this month, Bank Indonesia (BI) reported that the current account deficit had widened to US$6.96 billion in the first quarter or 2.6 percent of gross domestic product (GDP), much wider than in the same period last year at $5.19 billion or 2.01 percent of GDP. Bank Indonesia forecast that the current account deficit could reach the 3 percent threshold by the end of this year as the escalating trade war...