Indonesia's growth hits 5.47% in Q3, sprinting past forecasts

Indonesia's economy revved up in the third quarter, growing 5.47% from a year earlier, according to official data out Thursday. That sailed past the 5.18% economists polled by Reuters had penciled in. It also marks a step up from the second quarter's 5.29%.

The statistic bureau credited manufacturing for much of the lift, including the processing of palm oil into fuel as Indonesia widened its mandatory biodiesel programme. Southeast Asia's largest economy has spent the year fending off gloomier investor sentiment, with close attention on the government's fiscal plans and policy direction and persistent worry about a stock market downgrade.

The headline number lands near the top of the range the central bank has sketched out. Bank Indonesia sees GDP growth between 4.9% and 5.7%, and said last month the domestic economy was still resilient but needed more strengthening. Finance minister Suahasil Nazara has said growth could edge past the 5.4% written into the 2026 state budget and reach 5.5% this year.

Bigger ambitions sit further out. President Prabowo Subianto, who took office two years ago, wants to push growth to 8% by 2029 — a target that will need a lot more quarters like this one.

For now, the beat gives Jakarta a data point to wave at skeptics who have questioned its spending plans and policy course. Whether the momentum holds will depend on manufacturing, the biodiesel bet and whether investor nerves settle.