• Indonesia’s consumer confidence index (CCI) slipped to 115.0 in September 2025, from 117.2 in August, marking the lowest reading since April 2022. Although the index remains above the neutral level of 100, indicating continued optimism, the decline highlights a softening in household sentiment as economic uncertainties linger. Consumers appear to be more cautious about their income prospects, job security, and overall spending capacity.
• ⁠The detailed breakdown shows that five of the six sub-indices weakened during the month. The economic outlook index fell 2.0 points to 127.2, signaling that households are becoming less optimistic about near-term growth. Perceptions of job availability compared to six months ago also deteriorated, dropping 1.2 points to 92.0, indicating persistent concerns about labor market opportunities. Meanwhile, current economic conditions and income levels declined to 102.7 and 112.9, respectively, reflecting the strain on household budgets from modest wage growth and elevated living costs.
• ⁠Expectations of future income also moderated, with the index falling 2.4 points to 134.3, while the durable goods purchasing index weakened by 1.9 points to 103.2, suggesting consumers are delaying big-ticket purchases. The only bright spot came from job availability expectations for the next six months, which edged slightly higher by 0.3 points to 123.1, hinting that households still foresee some gradual improvement in labor market conditions.
• The decline in consumer confidence corresponds with signs of moderating domestic demand as the effects of earlier fiscal stimuli—such as wage support and social assistance—begin to fade. On the back of IDR depreciation, households are likely feeling the impact of higher food prices, tighter purchasing power, and cautious sentiment heading into the final quarter of the year. Looking at the broader scale, the weakening confidence mirrors regional trends, as emerging economies across Asia grapple with the combined effects of China’s slower recovery and continued high global geopolitical tensions.
• Going forward, we take some comfort in 4Q25 and 1Q26 consumer sentiment, supported by a combination of monetary and fiscal measures. Bank Indonesia’s series of rate cuts—bringing the benchmark rate down from 5.75% to 4.75%—is expected to gradually lower borrowing costs and ease credit conditions, improving household liquidity. Continued implementation of government stimulus programs should help sustain consumption among mid-to-low income groups. Moreover, improving employment prospects in sectors related to the free meal program could support gradual recovery in confidence. Nonetheless, downside risks persist; weaker IDR could increase the cost of imported goods, adding inflationary pressures, while global uncertainties may dampen the pace of recovery. That said, with Indonesia’s consumer confidence deteriorating and the IDR depreciation eroding economic growth, it is high time that the government must take more serious and fast measures in order to raise public optimism.