The S&P 500 recorded its worst performance in the last 3 months

After closing in the green two weeks ago, the United States market S&P 500 returned fell and recorded its worst performance since mid-June. Throughout the last week the S&P 500 Index experienced a decline of -4.78%. The biggest decline occurred on Tuesday after the monthly inflation report was released, and showed an increase of 8.3% YoY. Investors are now anticipating a significant increase in interest rates by the Fed by 75 bps on Wednesday 09/21. Apart from that, other economic indicators such as the Producer Price Index, retail sales, manufacturing activity, industrial production, and sentiment consumers are below expectations. As a result all sectors on the S&P 500 recorded red last week, with the biggest decline occurring in Real Estate and Materials, respectively -6.43% and -6.65% throughout the last week

The government issued BSU to control the rate of inflation

The Indonesian government began disbursing wage subsidy assistance (BSU) on Monday (12/09) to 4.36 million workers. Disbursement of IDR 600k/person in total IDR 2.61 trillion. Although it is different from BLT (direct disbursement), these funds It is also intended to cover compensation for increases in subsidized fuel prices.Currently, President Jokowi is considering joining China and India to buy Russian oil to stop rising prices further energy across the country. For 2023, the DPR has approved it increase in the energy subsidy budget to IDR 211.9 trillion from before IDR 210.6 trillion.

Indonesia's trade balance has been in surplus for 28 consecutive months

Indonesia's trade balance in August-22 was reported to experience addition (surplus) of USD 5.76 billion, higher than market expectations and the previous month it was USD 4 billion and USD 4.22 billion. Increasing exports in August-22 were driven by oil and gas and non-oil and gas exports respectively respectively recorded growth of 64.46% and 28.39% on an annual basis. The trade balance is one of the variables in calculating GDP (GDP = Consumption + Investment + Government Expenditures + Exports – Imports), where with the trade balance experiencing a surplus it will help encourage economic growth in a country.

Key Takeaways:

The S&P experienced its worst decline in 3 months, since June last year by -4.78% last week. This decline was driven by the monthly inflation report showing an increase of 8.3% YoY. Currently, investors anticipate with the potential for a significant increase in interest rates by the Fed of 75 bps in Wednesday 21/09.

From the domestic side, the Indonesian government has begun disbursing subsidy assistance upah (BSU) kepada 4,36 juta pekerja. Pencairan sebesar Rp600k/orang dengan total IDR 2.61tn. Although it is different from BLT (direct disbursement), these funds It is also intended to cover compensation for increases in subsidized fuel prices. The government through President Jokowi is considering buying it oil from Russia to prevent rising domestic energy prices. The energy subsidy budget for 2023 has also been approved by the DPR for IDR 211.9 trillion, an increase from the previous year of IDR 201.6 trillion in 2022

Indonesia's trade balance in August-22 was reported to experience addition (surplus) of USD 5.76 billion, higher than market expectations and the previous month it was USD 4 billion and USD 4.22 billion. Increasing exports in August-22 were driven by oil and gas and non-oil and gas exports respectively respectively recorded growth of 64.46% and 28.39% on an annual basis.

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