Indonesia’s economy grew 5.47% year on year in the third quarter of 2026, exceeding the 5.2% market forecast and accelerating from 5.29% in the second quarter. Gross domestic product rose 1.6% quarter on quarter, above expectations of 1.3% but well below the prior quarter’s 3.7% increase. Robust manufacturing activity, including palm-oil processing for fuel, supported growth as Indonesia expanded its mandatory biodiesel program. Household consumption and exports also supported expansion, while investor sentiment weakened amid scrutiny of the government’s fiscal plans, broader policy direction and downgrade risks affecting the stock market. Growth across the first three quarters of 2026 reached 5.45% from the same period in 2025, after the economy expanded 5.11% in 2025. The 2026 state budget targets 5.4% growth, while Finance Minister Suahasil Nazara said growth could reach 5.5% this year.