Indonesia’s economy shows strong momentum at the beginning of 2026. The government remains optimistic that economic growth will reach 6% this year, with Q1 projections between 5.5–6%, continuing the solid 5.11% growth recorded in 2025.

Liquidity conditions remain robust. Broad money (M2) expanded by 10.0% (yoy) in January 2026, reaching IDR 10,117.8 trillion, driven by 10.2% (yoy) credit growth and a 22.6% (yoy) increase in net claims on the central government.

However, the state budget recorded a deficit of IDR 54.6 trillion (0.21% of GDP) as of end-January 2026 — the deepest January deficit in the past five years, surpassing even pandemic levels. Government revenue stood at IDR 172.7 trillion, while spending reached IDR 227.3 trillion. Fiscal credibility remains intact, supported by debt financing realization of IDR 127.3 trillion (15.3% of the annual target).

The government has also allocated IDR 55 trillion for 2026 holiday allowances (THR), pending official presidential announcement, to sustain household consumption during Ramadan.

Meanwhile, Permata Institute for Economic Research (PIER) forecasts Indonesia’s 2026 growth at 5.1–5.2%, highlighting macroeconomic stability and fiscal–monetary policy synergy as key pillars.