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Consumer confidence, retail sales recover from Delta impact
As the year-end holiday season approaches, the two indicators point to increased household spending, which has long been a key driver of economic activity in the country.
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People visit Senayan City Mall in Jakarta on Christmas Day, Dec. 25, 2020. Greater Jakarta residents spend a large portion of their time off during the year-end holidays at the city's shopping malls. (Antara/Indrianto Eko Suwarso)
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onsumer confidence and retail sales data point to a recovery from the slump caused by the Delta wave of COVID-19, as eased activity restrictions bode well for household spending ahead of the year-end holiday season.
The consumer confidence index was recorded at 113.4 in October, Bank Indonesia (BI) reported on Monday, marking a return to the optimistic territory above the threshold of 100 points, a level not seen since March 2020. The index plunged to its lowest level in at least 12 years in August.
BI also reported on Tuesday that the retail sales index was estimated to have grown by 5.2 percent year-on-year (yoy) to 193 in October, more than making up for the 2.2 percent annual contraction seen in August.
“The consumer perception of the current economic situation appears to be improving, especially with regard to employment and income,” BI spokesman Erwin Haryono said on Monday, as quoted in a press release.
“This development is due to growing economic activity and people’s [improving] income, in line with the relaxation of mobility restrictions in various regions as a result of a COVID-19 response that had been getting better.”
Household spending, which accounts for more than half of Indonesia’s GDP, grew by a mere 1.03 percent in the July-September period from a year earlier as the Delta outbreak and government measures to contain it hit consumer activity, Statistics Indonesia (BPS) data show.
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