Rising wages and lowered interest rates bolster yearly outlook
San Francisco, CA -- (SBWIRE) -- 12/31/2012 -- While the world prepares to enter into 2013 and a new fiscal year, the property sector of Indonesia is looking to what promises to be a strong year.
The pointed optimism is based upon the buying power of lower income brackets becoming strong, as well as pick-up in the investment sector grows.
Local brokerage IndoPremier that the “domestic economy is still the theme in 2013” and will support the local Indonesian economy, despite a tough year in the global market. The brokerage also stated that its “Equity Strategy” outlook report for the upcoming year is looking strong for the consumer-related sector, as strong domestic spending is expected.
Experts at the brokerage have cited inflation rates falling below 5% in the past 17 months as a key indicator of good fortune for the future. The lowered rates keeps borrowing costs down, and the Bank of Indonesia's policy rate stayed at an all-time low of 5.75% since February of 2012.
“In 2013, Indonesia will continue to become a beneficiary of these conditions,” IndoPremier said.
Metropolitan Land and Surya Semesta Internusa have been pinpointed as companies to watch by IndoPremier. It stated that the launching of an office and apartment project “will be well received by the market.”
Meanwhile, the consumer sector is likely to see a boost due to recent wage raises. The rise is set at near 20% in the 31 provinces, prompting positive outlook for the near-future.
“More than 13 million workers will be the main beneficiaries of the higher minimum wages ... These workers will earn the most benefit from the latest minimum-wage policy,” the brokerage said. The wage increase “will be spent not only on foods but also on durable goods, and housing,” it said.
IndoPremier stated that Surya Internusa's plan to acquire land in Karawang was a positive indicator as well, as it adds to its current land bank of nearly 500 acres that have been accrued in the last three years.
The expansion is in order to take advantage of the demand for factory space in Indonesia. Another stock-price booster is the plans to create the budget hotel auxiliary business move.
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