Indonesia's BCA cuts loan growth forecast

Indonesia's slowing economy caused BCA to be less optimistic with its loan growth.

According to Bank Central Asia's chief executive, Jahja Setiaatmadja, its 2013 loan growth forecast was reduced to 18-20 percent, from 22-25 percent.

Concerns about Southeast Asia’s biggest economy have mounted as it recorded its first annual trade deficit ever in 2012 while rising fuel subsidies put heavy pressure on its currency and trade balance.

“I’m optimistic but cautious,” said Setiaatmadja.

“Our current account turned negative, exports dropped,” he added. “This is a fundamental problem. If we can’t handle it quickly, it could lead to higher inflation and affect interest rates and the foreign exchange market.”

The rupiah slipped last week to its lowest since 2009.

Indonesia recorded a December trade deficit of $150 million with declines in both imports and exports.

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