The current account performance in the third quarter of 2022 is getting more solid by continuing the trend of increasing surpluses, supported by stronger performance in non-oil and gas exportsJakarta (ANTARA) - Current account balance in the 2022 third quarter (Q3) recorded US$4.4-billion surplus, or 1.3 percent of the gross domestic product (GDP), surpassing previous quarter's US$4 billion, or 1.2 percent of GDP, Bank Indonesia (BI) stated.
The improvement in current account performance stemmed from an increase in the surplus in non-oil and gas trade balance in line with the continued strong demand for exports from trading partner countries and high global commodity prices as well as reduced deficit in the oil and gas trade balance in line with the decline in world oil prices.
"The current account performance in the third quarter of 2022 is getting more solid by continuing the trend of increasing surpluses, supported by stronger performance in non-oil and gas exports," Executive Director of the BI Communication Department Erwin Haryono noted in an official statement here, Friday.
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Thus, the current account balance can withstand pressure on Indonesia's balance of payments (NPI) due to pressure on the capital and financial account, in line with increasing global financial market uncertainty.
The balance of payments in the third quarter of this year recorded a deficit of US$1.3 billion, with the position of foreign exchange reserve assets at September-end of 2022 recorded at US$130.8 billion, or equivalent to financing 5.7 months of imports and servicing government's external debt, and was well above the international adequacy standard of three months of imports.
Capital and financial account pressures were reflected in a deficit of US$6.1 billion, or 1.8 percent of the GDP, higher than the deficit of US$1.2 billion, or 0.3 percent of the GDP in the second quarter of this year. However, the performance of this transaction can still be supported by direct investment amid increasing uncertainty in global financial markets.
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Foreign direct investment recorded a surplus that remained high in line with investor optimism regarding the prospects for economic improvement and a maintained domestic investment climate. Meanwhile, net portfolio investment outflows increased due to heightened uncertainty in global financial markets and the need to repay maturing private debt securities.
Other investment transactions also recorded a rise in deficit due to an increase in private assets, especially those related to operational business activities.
Going forward, BI will continually focus on the dynamics of the global economy that can affect the prospects for the balance of payments and keep strengthening its policy mix supported by close policy coordination with the government and relevant authorities to strengthen external sector resilience.
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Translator: Agatha O, Azis Kurmala
Editor: Fardah Assegaf
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