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Macro - Indonesia
#1
very good article from Bloomberg on the dilemma of Indon policymakers:

https://www.bloomberg.com/news/articles/...rowth-lags

'Despite eight interest rate cuts since the beginning of 2016 - demand for loans remains weak and economic growth continues to disappoint.'

'While that gives policy makers reason to continue easing, they can’t ignore a depreciating currency as the Federal Reserve proceeds with its rate hikes'

'However, rate cuts can’t be ruled out in the first quarter of 2018 if inflation remains low and growth continues to disappoint, he said.'

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#2
structural driver is strong but FX is always an issue in investing on the region.. need to be choose the right wave to ride
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#3
Inflation has picked up in December driven by food.

However, consumer spending is still rather weak. Seems that this is caused by specific sector issue (logistic or supply issue) rather than the recovery of consumption.

"Bank Indonesia Assistant Governor Dody Budi Waluyo said consumption should recover this year at a “limited pace,” as the purchasing power of low and middle-income earners improved. “However, consumption is predicted to still be on hold among high-income people,” as they were spending more selectively"

Next year consumption to recover slightly but at least further rate cut seems to be unlikely at this juncture..

https://www.bloomberg.com/news/articles/...-rate-cuts
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#4
Pre-election fever is up again. 

Now, the government will distribute more effectively to the lower-income people (non-cash, less corruption). Hope that this will support the weak purchasing price of the grassroot people which was the issue for 2017!

Focus on low-mid-income targeting stocks?  Cool

http://www.thejakartapost.com/news/2017/...ogram.html
http://www.thejakartapost.com/news/2017/...arung.html
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#5
Most likely candidate is Perry Warjiyo, which is the current Deputy Governor.

Expect policy to be the same as now (wait and see) with focus on inflation.

Will be interesting how the next 6 quarters go with upcoming election on hand.

https://www.bloomberg.com/news/articles/...continuity
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