The Financial System Stability Committee expects resilient household consumption, stronger investment and higher government spending to sustain economic growth despite external headwinds.
Indonesia’s Financial System Stability Committee (KSSK) projects the country’s economy to grow by 5.6%–6.0% in 2026, supported by resilient household consumption, stronger investment and accelerated government spending, according to the committee’s regular meeting held in Jakarta on Monday, August 3, 2026.
KSSK Chairman and Finance Minister Purbaya Yudhi Sadewa said Indonesia’s economy remains resilient despite heightened geopolitical tensions and volatility in global financial markets. He added that the manufacturing sector’s return to expansion further reinforces the country’s growth outlook.
“Indonesia’s economy is expected to remain strong in the second quarter of 2026 despite global economic challenges,” Purbaya said.
Household consumption is expected to remain the primary engine of growth, supported by the state budget’s role in cushioning the impact of external shocks. The government continues to implement social protection programs, stabilize food and energy prices, create jobs and provide fiscal stimulus during the school holiday period to help preserve consumers’ purchasing power.
“Household purchasing power remains intact in supporting consumption, backed by the state budget’s role as a shock absorber through social protection programs, food and energy price stabilization, job creation and fiscal stimulus,” Purbaya said.
Investment is also projected to strengthen, driven by the acceleration of downstream industrialization projects and priority infrastructure development. Meanwhile, Indonesia’s Manufacturing Purchasing Managers’ Index (PMI) returned to expansion territory, rising to 50.2 in July 2026 after contracting at the end of the second quarter.
“With this policy synergy, Indonesia’s economy is projected to grow within the range of 5.6%–6.0% year-on-year throughout 2026,” Purbaya said.
To maintain growth momentum and safeguard financial system stability, KSSK said policy coordination among the Finance Ministry, Bank Indonesia, the Financial Services Authority (OJK) and the Indonesia Deposit Insurance Corporation (LPS) will continue to be strengthened.