Business Activity in Indonesia Expected to Remain Solid Moving Forward: BI

Jakarta: The latest Business Survey conducted by Bank Indonesia (BI) points to stronger business expansion in the second quarter of 2022.
 
It is reflected by a significant uptick in the weighted net balance (WNB) to 14.13% from 8.71% in the first quarter of 2022. 
 
"Business activity in the Manufacturing Industry, Trade, Accommodation and Food Service Activities as well as Transportation and Communication sector expanded in the reporting period given looser mobility restrictions in various regions, seasonal demand stoked by national religious holidays (HBKN) as well as the availability of production facilities," BI Communication Department Head Erwin Haryono said in a press release on Thursday.

Consistent with stronger business activity, production capacity utilisation increased in the second quarter of 2022 to 73.22% from 73.08% in the previous period. Labour utilisation also improved in the second quarter of 2022, thus moving out of a contractionary phase. 
 
Meanwhile, the latest survey also indicates improving corporate financial conditions compared with conditions in the previous quarter, particularly in terms of liquidity and profitability, supported by easier access to finance.
 
Respondents predict solid business activity in the third quarter of 2022, as indicated by a WNB of 13.75%, supported by several economic sectors, including Mining and Quarrying, the Manufacturing Industry in line with the availability of production facilities, as well as the Construction Sector in accordance with historical trends and growing domestic demand.  
 
Meanwhile, respondents anticipate moderation in the Agricultural, Plantation, Livestock, Forestry and Fishing subsector, affecting the Food Crop subsector (including horticulture) in particular, given historical trends during the planting season.
 
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