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Consumer Confidence at 6-Month High Despite Dark Clouds
Dion Bisara | January 04, 2012

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Indonesia’s consumer confidence index rose to a six-month high in December amid rising optimism about the country’s economic growth prospects despite a likely global slow down, a survey from Danareksa Research Institute showed on Wednesday.

The index rose 0.2 point to 91.6 in December, the survey showed, marking the highest result in six months, Purbaya Yudhi Sadewa, chief economist at Danareksa Research Institute, said on Wednesday.

That survey used samples from 1,700 households in six large Indonesian cities.

A similar survey conducted by Bank Indonesia showed that the country’s consumer confidence index rose to a record in December on growing optimism on accelerating economic growth.

The central bank’s measure rose 2.3 points to 116.6 in December from 114.3 in the previous month, the central bank said when it released the survey results on Monday. A reading below 100 indicates that pessimists outnumber optimists.

Purbaya said that the debt crisis in Europe and slowing economic growth in the United States may cast a shadow over the Indonesian economy’s shining prospects.

“The increase in the index showed that Indonesian consumers remained confident that economic expansion has not been affected by the global economic slowdown,’’ he said.

Bank Indonesia said last month that it had cut its forecast of the country’s economic growth to 6.3 percent this year from a previous forecast of 6.7 percent, reflecting the impact of the possible global slowdown.

The central bank kept its benchmark rate at 6 percent in December after trimming the rate by combined 75 basis points in October and November.

It kept the policy rate at a record low to spur growth in the Southeast Asia’s largest economy.

Bank Indonesia said it was seeking to slow inflation to 3.5 percent to 5.5 percent this year. Consumer prices rose 3.79 percent in December, the lowest in 21 months.