The forecast for consumer spending in 2025 is optimistic, driven by a stronger rupiah, easing monetary policy, and lower inflation, which collectively support real wage growth.

Real consumer spending growth in Indonesia is projected to rise to 5.2% year-on-year in 2025, reaching IDR7,376.9 trillion at 2010 prices.

In contrast, real consumer spending growth is expected to decelerate slightly to 5.0% year-on-year in 2024, amounting to IDR7,012.6 trillion at 2010 prices.

The incoming president's growth-supportive policies are anticipated to bolster government spending and enhance economic momentum.

Increasing consumer confidence and retail sales growth in Indonesia indicate a positive outlook for consumer spending in 2024.

This improved consumer sentiment is linked to easing inflation, which allows households to feel more financially stable and encourages spending on both essential and discretionary goods.

Easing inflation rates are expected to contribute to stronger growth in household incomes, while declining interest rates will relieve pressure on indebted consumers.

Falling inflation is enhancing purchasing power, creating better employment opportunities and further stimulating consumer spending.

Stabilizing prices are enabling consumers to allocate more of their incomes toward spending, benefiting sectors such as retail, dining, and travel.

Businesses are encouraged to adapt to changing consumer preferences and invest in digital platforms and customer engagement strategies to capitalize on the anticipated growth in consumer spending.

A stronger rupiah is expected to reduce the cost of imported consumer goods, further stimulating spending.