Household Consumption Supports Indonesia's 5.47?onomic Growth

Jakarta: Indonesia's economy continues to show resilience amid global economic changes. In the third quarter of 2026, the national economy grew 5.47 percent year-on-year, mainly supported by strong household consumption.

This growth is also higher than the 5.04 percent recorded in the same period last year. Household spending has been one of the main drivers of economic activity, as people's mobility, online shopping, and tourism have picked up again.

Statistics Indonesia (BPS) Deputy for Balance and Statistical Analysis Moh. Edy Mahmud stated household consumption remained the biggest force behind economic growth in the third quarter of 2026.

"Indonesia's economy in the third quarter of 2026 grew solidly at 5.47 percent year-on-year, mainly supported by steady household consumption," Edy said during press conference in Jakarta on Thursday, November 5, 2026.

The Backbones of economic growth

According to Edy, household consumption grew 5.04 percent year-on-year. It made the largest contribution to national economic growth, at 2.62 percentage points. This is also better than household consumption growth in the third quarter of 2025, which was 4.89 percent.

Strong public spending can be seen along with the rise in online transactions for goods and services. Greater mobility and the revival of tourism have also helped keep demand up.

Meanwhile, government policies to control inflation have helped maintain people's purchasing power.

Steady consumption has gone hand in hand with rising investment. Gross fixed capital formation (PMTB) grew 6.06 percent year-on-year, showing that investment from both the government and the private sector is still ongoing.

Government spending also increase significantly. In the third quarter of 2026, government consumption grew 8.95 percent, higher than the 5.66 percent growth in the same period last year.

This increase came partly from higher spending on employees, including salaries and allowances for civil servants, as well as spending on goods and services, including the Free Nutritious Meals (MBG) program.

Production sectors grow

On the production side, economic activity was supported by several sectors closely linked to people's needs and business activity.

Manufacturing was the largest contributor, adding 1.20 percentage points to growth, followed by trade at 0.94 points, construction at 0.62 points, and information and communication at 0.49 points.

Manufacturing grew 5.87 percent. This growth came not only from domestic demand but also from overseas markets.

"If we break it down by subsector, the manufacturing sector's positive performance was mainly supported by the food and beverage industry, which grew 7.09 percent; the chemical, pharmaceutical, and traditional medicine industry, which grew 8.10 percent and the basic metals industry, which grew 9.94 percent," Edy explained.

Trade also picked up. The wholesale and retail trade and car and motorcycle repair sector grew 7.14 percent, higher than 5.46 percent in the third quarter of 2025 and 4.85 percent in the third quarter of 2024.

Higher vehicle sales, especially commercial and electric vehicles, helped drive the sector. The supply of goods from domestic manufacturing, as well as imported goods, also increased, making trade activity busier.

The construction sector grew 6.42 percent, up from 4.21 percent in the third quarter of 2025. Infrastructure projects carried out by both the government and the private sector were among the drivers, including priority programs such as the Red and White Village Cooperatives (KDKMP), public housing, People's Schools (Sekolah Rakyat), Garuda Schools, and school revitalization.

As digital economic activity expands, the information and communication sector grew 7.13 percent. This was in line with higher data traffic, greater use of data center services, and more e-commerce transactions.

By region, several areas recorded growth above the national average. Bali and Nusa Tenggara grew the fastest at 6.08 percent, followed by Java at 5.84 percent and Sulawesi at 5.68 percent.