Manufacturing PMI Surges to 53.8—Sign of Indonesian Economic Recovery?
Jakarta—Indonesia’s manufacturing sector demonstrated expansive performance in February 2026, with the Manufacturing Purchasing Managers Index (PMI) climbing to 53.8 from 52.6 in January, reaching its highest level in nearly two years.
The Director General of Economic Strategy and Fiscal Policy at the Ministry of Finance attributed this strengthening to a surge in new demand coupled with significant production growth. “Domestic economic resilience has become crucial capital amid a dynamic global situation,” said Febrio in an official statement released on Monday, 2 March 2026.
Manufacturing PMI readings from Indonesia’s key trading partners also displayed expansive trends, including Vietnam (54.3), Thailand (53.5), India (57.5), Japan (53.0), and the United States (51.2), bolstering prospects for national manufacturing exports.
Positive sentiment has been further supported by strengthened domestic demand. In January 2026, the Real Sales Index grew 7.9 per cent year-on-year, driven by increased sales in food and beverages, textiles, and enhanced population mobility. The consumption strength extended to motorised vehicle sales, with motorcycle sales rising 3.1 per cent and car sales growing 7.0 per cent.
Consumer optimism remained steady, reflected in the January 2026 Consumer Confidence Index at an optimistic 127, up from 123.5 in the previous month.
The trade balance recorded a surplus of US$0.95 billion. This surplus was supported by export performance reaching US$22.16 billion, growing 3.39 per cent year-on-year, driven primarily by non-oil and gas exports. The non-commodity export performance was bolstered by the processing industry sector, which grew 8.19 per cent year-on-year, led particularly by palm oil, nickel, iron and steel, and high-value-added commodities such as automotive and electronics.
Imports were recorded at US$21.20 billion, representing an 18.21 per cent year-on-year increase, predominantly reflecting higher raw materials and capital goods imports, consistent with rising domestic production and investment activities.
From a global perspective, risks arising from Middle Eastern tensions require careful monitoring, particularly following Israeli and American strikes against Iran on 28 February 2026, which resulted in the closure of the Strait of Hormuz. Potential disruptions to global supply chains, especially regarding energy and petroleum supplies, as well as increased volatility in global financial markets, remain primary concerns.
Febrio noted that global trade tensions could potentially pressure national export performance through weakened external demand and increased logistics costs. “The government continues to carefully monitor global geopolitical dynamics and various risks that could affect the national economy,” Febrio stated.