From a global perspective, several early indicators have shown a recovery, including an increase in trade volume, commodity prices, and export-import performance, he said. While domestically, economic recovery can be gauged from the mobility of the community, which has begun to increase, in line with the sloping of COVID-19 cases, he added.
"Indicators of improvement have been increasingly evident globally and domestically, which later, we, in the authority, have seen that the policy response has begun to be carried out together in the Financial System Stability Committee (KSSK),” Haryono said during an online discussion in Jakarta on Thursday.
The retail sales index indicator to the consumer expectation index has also started to show an increase, with the Real Sales Index (IPR) in March, 2021 growing 6.1 percent (mtm), an increase from the previous month’s growth of minus 2.7 percent (mtm), he informed.
Economic improvement is also evident from the lower economic contraction of 0.74 percent (yoy) in the first quarter of 2021 compared to the fourth quarter of 2020, when it was pegged at minus 2.19 percent, he said.
"This economic improvement was mainly driven by export performance due to increased demand from China and the US, realization of fiscal spending (goods spending, capital expenditure, and social assistance), as well as non-construction investment," he elaborated.
He revealed that Bank Indonesia expects the domestic economy to begin improving in the second quarter of 2021. A number of early indicators have shown that the economy has continued to revive, as reflected in consumer expectations, retail sales, and increased spending realization, he said.
From the demand side, economic improvement has been mainly driven by increased exports and non-construction investment, he disclosed. In terms of the business field (LU), the increase has been seen in a number of sectors, such as manufacturing, trade, and construction.
"Economic growth in 2021 will remain in line with Bank Indonesia's projection in April, 2021, which is in the range of 4.1 - 5.1 percent," he projected.
He further emphasized that health recovery will be key to economic revival and the government is currently focusing on the COVID-19 vaccination program to deal with the virus that was first reported in China.
According to Haryono, the sloping COVID-19 caseload has encouraged increased community mobility and the ongoing vaccination program for building herd immunity is expected to help restore the economy.
There is strong and close policy communication between regulatory agencies, including the central bank, the Financial Services Authority (OJK), and the Deposit Insurance Corporation (LPS), and the Ministry of Finance is continuing to accelerate national economic recovery, he added.