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COVID-19 curbs seen widening Indonesia's trade surplus in July

JAKARTA : Indonesia's trade surplus is expected to show an expansion in July after the government imposed mobility restrictions to control a spike in COVID-19 cases, squeezing exports and imports, a Reuters poll showed on Friday.

Southeast Asia's biggest economy has been enjoying an export boom on the back of high commodity prices, allowing for a trade surplus every month since May of 2020.

The median forecast of 10 analysts in the poll was for a July trade surplus of US$2.27 billion, up from the previous month's US$1.32 billion.

Export growth of 30.20per cent, on an annual basis, was forecast.

While high commodity prices still supported shipments, the estimated increase would be the lowest since February and below the more than 50per cent growth rate recorded between April to June.

Imports were seen shrinking on a monthly basis, but up 52.15per cent annually due to a low base effect.

"We expect a wider trade surplus from the previous month as imports recede following the July lockdowns in Java," analysts with Citi Indonesia said.

Some economists have said high commodity prices and a global economic recovery will likely allow resource-rich Indonesia to book big export earnings for the remainder of the year, but imports may take a hit as COVID-19 curbs imposed since July dampen domestic demand.

(Polling by Nilufar Rizki in Jakarta and Shaloo Shrivastava in Bengaluru; Writing by Gayatri Suroyo; Editing by Ed Davies)

Source: Reuters

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