JAKARTA, Thekabarnews.com—Despite worries about a faltering global economy, a Bloomberg survey shows that Indonesia’s economy is expected to hold up. The forecast is 5 percent gross domestic product (GDP) growth in the second quarter of 2026.

The estimate shows that outside headwinds do not affect the region’s biggest economy. These include a slowdown in global demand, geopolitical tensions, and uncertainty in the monetary policies of key economies.

According to a Bloomberg survey of economists, domestic consumption, government spending, and investment activity will remain the engines of economic development. This trend will continue in the first half of this year.

But economists also warned growth may slow in the second half of 2026. During this time, the global economic environment may become more challenging.

The outlook comes as many countries are grappling with weaker growth prospects amid persistent inflationary pressures and high interest rates. Furthermore, there is extended disruption to global trade and supply systems.

Indonesia has performed better than some of its emerging market peers lately, but officials worry about risks from overseas events.

Analysts said domestic demand remains one of the key supports of Indonesia’s economic growth. A strengthening labor market and robust consumer activity continue to support household consumption. Notably, household consumption accounts for over 50 percent of the economy’s output.

Investment in infrastructure, manufacturing, and digital industries has also supported growth. But growth looks like it will be tougher in the second half of the year.

A slowdown in growth in major economies such as the US, China, and parts of Europe could dampen demand for Indonesian commodities for export. It could also reduce demand for manufactured goods.

Geopolitical tensions and the volatility of financial markets could weigh on investor sentiment in emerging economies for some time. But the big worry for policymakers is inflation, although there is still uncertainty about growth.

Inflationary pressures are expected to stay relatively high until 2026. In addition, energy prices, food costs, and changes in currency rates will continue to push costs up across the world.

This situation has strengthened the view among many economists that Bank Indonesia will keep its relatively tight monetary policy stance. They expect the trend to continue in the coming months.

The bank reaffirmed its commitment to macroeconomic stability and to supporting the rupiah against external shocks.

But higher rates could also support the currency and help keep inflation expectations anchored. Even so, such policies could crimp economic activity to some extent.

“Bank Indonesia remains focused on maintaining stability while balancing growth objectives,” several economists from the market said in the latest study reports.

Policy objectives to strengthen investor confidence and maintain the rupiah in a more uncertain environment are still important.

The outlook underscores the difficult road Indonesian officials must navigate. They want to grow the economy, bring investment, and create jobs.

But they should also be vigilant to the risks of inflation and maintain financial stability. Additionally, they need to respond in a timely manner to changes in the international economic environment.

Economists remain relatively sanguine about Indonesia’s medium-term prospects, even as forecasts point to a slowdown later this year.

The country’s long-term economic prospects are based on strong domestic demand and continued infrastructure investment. Moreover, a fast-growing digital economy and favorable demographics support these prospects.

Besides, the success of Indonesia in maintaining stable development as well as monetary and financial stability is also an important factor. Such stability supports investor confidence and economic performance in 2026. The support comes in the middle of ongoing global economic uncertainty.

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