Indonesian Consumer Confidence drops to 158 in September following significant protests about controversial new laws

In September Roy Morgan Indonesian Consumer Confidence dropped to 158, down 4.8pts from August. Consumer Confidence is now 2.4pts lower than a year ago in September 2018 (160.4).

On a regional level the drop from a year ago has been most significant in the capital Jakarta and nearby provinces of West Java and Banten as well as provinces at the northern end of the island of Sumatra. 

In the region including the capital Jakarta and the surrounding provinces of West Java and Banten, Consumer Confidence dropped 7.6pts to 151. Confidence is also down significantly in the Northern Sumatra provinces, including North Sumatra, West Sumatra and Riau by 10.3pts to 142.3.

Bucking the trend compared to a year ago were the islands of Sulawesi and Kalimantan. Consumer Confidence increased 7.2pts to 166.4 in Kalimantan and 0.9pts to 177.7 in Sulawesi. Sulawesi remains clearly the most confident part of Indonesia.

“Extensive protests that broke out in Indonesia in September appear to have dented the confidence of Indonesians, with the index dropping to its lowest since January this year,” said Ira Soekirman, Director of Roy Morgan Indonesia. “The protests were sparked by plans to remove key powers from Indonesia’s Corruption Eradication Commission but quickly grew to encompass other issues.

Soekirman also noted the regional nature of the drop: “The decline was also evident on an annual level, with the most substantial drop concentrated in the provinces of Northern Sumatra as well as in the capital Jakarta and the surrounding provinces in West Java where the protests were at their most prominent.

“At the end of September President Jokowi postponed consideration of the new laws until the new legislature was seated (in late October) which means the protests may return in coming days and weeks as the controversial laws are debated and considered,” concluded Soekirman.

Indonesian Consumer Confidence by Island & Region: Sept. 2018 cf. Sept. 2019

Source: Roy Morgan Indonesian Single Source: Indonesians aged 14+ Sept. 2018 (n=1,289) & Sept. 2019 (n=1,291).

Long-term Roy Morgan Indonesian Consumer Confidence: 2009-2019

Source: Roy Morgan Indonesian Single Source: Indonesians aged 14+ September 2019 (n=1,291).

Key components of Indonesian Consumer Confidence fall in September

Analysis of the latest consumer confidence compared to a month ago shows the monthly decrease is across the board, but concentrated in views about the next year, both for personal financial situations and also the Indonesian economy at large.

Now 40% (down 4ppts) of Indonesians consider their families are ‘better off’ financially than this time a year ago and 8% (unchanged) say their families are ‘worse off’ financially.

A sliding majority of 67% (down 7ppts) of Indonesians expect their family will be ‘better off’ financially this time next year (the lowest figure for this indicator for exactly two years since September 2015) although only 4% (up 1ppt) expect to be ‘worse off’ financially.

In September, 89% (down 4ppts) of Indonesians expect Indonesia will have ‘good times’ financially during the next 12 months, and just 10% (up 3ppts) expect ‘bad times’ financially.

And looking at the longer-term, 92% (down 2ppts) of Indonesians expect Indonesia will have ‘good times’ economically over the next five years and 7% (up 2ppts) expect ‘bad times’.

A slightly decreased majority of 64% (down 1ppt) of Indonesians say ‘now is a good time to buy’ major household items and 33% (unchanged) say ‘now is a bad time to buy’ major household items.

Despite the monthly fall Indonesian Consumer Confidence remains a significant 20.7pts above the long-run average (2005-2019) of 137.3.

The monthly Roy Morgan Indonesian Consumer Confidence Rating is based on 1,291 in-depth face-to-face interviews conducted in September throughout Indonesia, not just a handful of cities. The survey includes the Top 23 cities, smaller cities and towns as well as many more villages in the rural hinterland, reflecting all of Indonesia.

Consumer Confidence remains very high in Indonesia when compared to Indonesia’s Asia-Pacific neighbours – Australia October 19/20, 2019 – 111.6) and New Zealand (September 2019 – 113.9) and long-term Consumer Confidence trends for the three countries are covered extensively here.

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