Indonesia's Economy Grows Faster in First Half of 2026 Than Previous Year
Bisnis.com, JAKARTA - Statistics Indonesia (BPS) reported today (5/8) that the Indonesian economy grew steadily by 5.29 percent year-on-year (y-on-y) in the second quarter of 2026. This economic growth for Q2-2026 is higher than the 5.12 percent recorded in Q2-2025. Amidst global dynamics full of uncertainty, this performance demonstrates the maintained resilience of the domestic economy.
Head of BPS, Amalia Adininggar Widyasanti, explained in a written statement in Jakarta (5/8) that Indonesia’s economy in Q1-2026 and Q2-2026 grew faster compared to Q1-2025 and Q2-2025. This indicates that economic activity in Indonesia continues to move, both from the production and demand sides. Amalia also stated that “Economic growth throughout Semester 1-2026 reached 5.45 percent, far above the Semester 1-2025 growth of 5.0 percent. This shows the government has successfully capitalised on Indonesia’s economic growth momentum, so that in 2026 up to Semester 1, the economy grew faster than last year.” Amalia added, “the main pillars supporting this Semester 1-2026 economic growth are sustained public consumption, high investment growth, and government spending that is still growing faster compared to last year.”
Consumption was also supported by government economic policies in maintaining people’s purchasing power, such as: the payment of the 13th-month salary in June 2026, discounts on transportation tickets during the school holiday period in June, and efforts to control inflation which further strengthened domestic consumption.
On the other hand, digital-based economic activity also showed improvement, reflected in the growth of e-retail and marketplace transactions, as well as the increasing value of electronic money, debit card, and credit card transactions.
In addition to household consumption, the Gross Fixed Capital Formation (PMTB) component also recorded solid growth of 6.87 percent, driven by private and government investment. Meanwhile, government consumption grew significantly by 15.97 percent, in line with the increased realisation of personnel expenditure and spending on goods and services, including through pro-people programmes such as: Free Nutritious Meals (MBG), the construction of 3 million houses, the building of people’s schools and the renovation of regular schools, among others.