Southeast Asia’s largest economy had a surplus of US$540 million in March, compared with February’s US$330 million surplus and a forecast of US$180 million deficit in a Reuters poll.

Exports fell 10.01% from a year earlier to US14.03 billion in March. This was against an 11.82% drop expected in the poll.

Imports dropped 6.76% to US$13.49 billion, compared to the poll’s forecast of a 3.76% decline.

Trade deficit hit a record high of US$8.5 billion in 2018 and authorities have been trying to reverse that by raising tariffs to halt imports and relaxing rules to support exports.

Analysts say an improvement in trade and current account deficits is a determining factor for Bank Indonesia (BI) to start loosening monetary policy, now that inflation is stable and the US Federal Reserve will probably not raise rates further this year.

BI last year increased interest rates by a total of 175 basis points in response to a weak rupiah and capital outflows that were partly prompted by rising US interest rates and large trade and current account deficits.

The central bank’s next policy meeting is scheduled for April 24-25