(Adds details, comments and market reaction)
* Jan exports -8.09 pct y/y vs -4.60 pct in Reuters poll
* Jan imports -15.59 pct y/y vs forecast -6.00 pct
* Trade balance at $709 mln surplus vs forecast $140 mln deficit
By Nilufar Rizki and Gayatri Suroyo
JAKARTA, Feb 16 (Reuters) - Indonesia posted an unexpected surplus in January after imports slumped, signalling continuing weakness in consumption at a time when exports are flagging.
Southeast Asia’s largest economy is off to a weak start this year with exports and imports in January falling more sharply than expected and down for a fourth straight month.
Data from the statistics bureau on Monday showed imports in January dropped 15.59 percent from a year earlier, far worse than the 6 percent fall expected by analysts in a Reuters poll. Exports shrank 8.09 percent versus a forecast 4.6 percent fall.
“We are just a little concerned about the import numbers. While the trade surplus is a positive, the collapse in imports could indicate that domestic demand is under pressure as well,” said Gundy Cahyadi, economist with DBS Bank in Singapore.
Agustinus Prasetyantoko, a professor at Universitas Katolik Atma Jaya in Jakarta, said the trade surplus resulted from a sharper drop in imports than exports. “This indicates that though the trade balance is improving, economic activity is actually slowing.”
Economists had forecast a trade deficit of $140 million.
Indonesia’s gross domestic product expanded at its weakest pace in five years in 2014 on weak exports and investment. The country’s main driver of growth, private consumption, also slowed in the last quarter dampened by high interest rates.
On the flip side, the slide in global oil prices to their lowest in almost six years has helped the net oil importer reduce its import bills. Oil and gas imports in January dropped 40.42 percent from a year earlier.
Imports of consumer goods fell 20.25 percent, while imports related to investments in areas such as raw materials and capital goods also plunged.
The rupiah strengthened to 12,735 per dollar, shored up by the country’s improved trade balance, but the stock market was unchanged after the data, down 0.4 percent.
Indonesia has been struggling to turn its annual trade balance back to a surplus since 2012. That, and a deficit in its services sector, has put the country’s current account balance in negative territory for three years.
On whether a trade surplus can be sustained, Prasetyantoko noted the government’s upcoming infrastructure projects.
“This will increase imports of raw materials so imports will probably rise later. If exports cannot pick up, then the chance of a full year trade surplus is small.” (Reporting by Adriana Nina Kusuma; Additional reporting by Jongwoo Cheon in Singapore; Editing by Jacqueline Wong)