Jakarta (VNA) – Ramadan and Idulfitri season is projected to provide a modest but meaningful boost to Indonesia’s economic growth, with expansion estimated at up to 0.3%, according to Permata Bank’s Head of Macroeconomic and Financial Market Research Faisal Rachman.
Faisal said the Ramadan-to-Eid period could lift growth by around 0.25%–0.3%, driven mainly by stronger household consumption. He said that the bank estimates that Ramadan and Eid could add around 0.25 to 0.3 percentage points to Indonesia’s economic growth.
He noted that the seasonal impact aligns with rising consumer spending during Ramadan, supported by higher mobility during the annual mudik homecoming and increased purchases of holiday-related goods.
Sectors expected to benefit most include food and beverages (F&B), restaurants, transportation and leisure.
On purchasing power, Faisal assessed that household conditions remain relatively stable. This is supported by the near-simultaneous disbursement of social assistance, discounted mudik transportation fares, and the payment of holiday allowances (THR) and bonuses.
However, he warned of potential inflationary pressures, particularly in food commodities, which could erode purchasing power if not properly managed. Rising inflation, especially in food commodities, needs to be closely monitored as it could reduce purchasing power, he said.
Staple food prices tend to rise seasonally due to higher demand during Ramadan and Idulfitri. In addition to demand-side pressures, extreme weather could disrupt supply and distribution in several regions.
Still, Faisal pointed to ongoing horticultural harvests that are helping maintain market supply. The government has also rolled out price stabilisation measures, including the Affordable Food Movement (GPM), market operations and stock stabilization efforts through state logistics agency Bulog.
Faisal said Ramadan consumption remains relatively solid and could serve as a buffer for economic growth amid global headwinds. Consumption during Ramadan remains relatively well maintained and is capable of supporting economic growth, he concluded./.
Indonesia accelerates technological self-reliance strategy
Indonesia accelerates technological self-reliance strategy
