Jakarta - Indonesia's economy expanded 5.61% in the first quarter of 2026 compared to a year earlier, outpacing the 5.30% growth expected by analysts. This marks the fastest annual growth since the third quarter of 2022, according to Statistics Indonesia.
The quarterly surge was fueled by strong activity in manufacturing, trade, and agriculture. On a quarter-on-quarter basis, however, GDP contracted 0.77%, reflecting typical seasonal patterns.
President Prabowo Subianto has set an ambitious target of 8% annual growth over his five-year term. To support near-term expansion, the government accelerated fiscal spending in Q1, releasing around 15 trillion rupiah ($860 million) for food assistance and other stimulus measures.
Headwinds remain, including rising energy prices due to the Middle East conflict and a weaker rupiah. The International Monetary Fund recently trimmed its 2026 growth forecast for Indonesia to 5%, citing global risks.