The development of GDP in the 4th quarter of 2018, is predicted to reach 5,27%. The percentage mentioned is considered an increase compared to the same period within the last three years, increasing by 0.10% compared to the second quarter of 2018.

Based on the current interim data published by the BPS (Central Bureau of Statistic), it is founded that in the 3rd quarter of 2018, there were several sectors that contributed towards the large growth rate increase for GDP, among them was the rubber industry- materials of both rubber and plastic, generated a growth rate that reached 12.34%, as for the textile and garment industry they are now sitting at 10.17%. Within this current 4th quarter, it is predicted that we will still endure similar progress.

Meanwhile in early 2019 coming, PT. Visi Globalindo Data Utama forecast that the Indonesia’s economic growth a will rise to 5.11%. This assumption is based on the exchange of IDR (Indonesia Rupiah) to United States Dollar (USD) that will possibly move up to IDR 15,000.00 per USD from the previous IDR 14,500.00 per USD.

The following change was based on the current global dynamics, mainly the policy normalization of which is monitoring the US and the trade wars. There was an assumption that the exchange rate that is continually weakening affecting the economic growth, particularly from the aspects of import and investments.

According to the data of BPS per September, the importing of raw materials such as machinery and mechanical aeroplanes, electronical equipment and even processed garments has faced a drastic downfall.

The effects of the downfall previously stated was initially exposed from the data of PMI (Prompt Manufacture Index) as per September. In the data mentioned, an index was located on level 50.7 or down compared to the previous month which was 51.9. Although the number on the stated index was above 50 of which signified that the company was still expansive; therefore Indonesia’s economic growth is facing a deficient prospect.

Whereas if we were to perceive this from the point of view as an investment, the ongoing downfall of exchanging IDR would also affect the credit interest rates, especially from the capital labour’s point of view. Based on the information, by repeating the same impairment, Bank of Indonesia will increase the interest rate referring up to 150 base points (BPS) ranging 5.75%.

This was seen from the SPI (Indonesia Banking Data) as per July 2018, where the capital labour’s credit interest rate and investments will continue to rise. The moment interest rates refer back an increase by May 30th 2018, an interest rate of credit banking will also follow the rising rate, specifically credit interest rate of investment. When the rise of credit interest rate intensifies, companies will hesitate to borrow from the bank. As a result, post investments will face a threat of a downfall and will cause a continuous downfall as we approach the year of 2019.