The new vehicle market in Indonesia continued to recover in June, with sales rising by 11.3% to 91,500 units from 82,200 units a year earlier, according to data released by the automotive industry group Gaikindo.

The market last month was lifted by heavy buying activity ahead of the annual Idul Fitri holidays when workers typically get an annual bonus of one month's salary. The annual holiday moves forward four weeks each year, meaning next month could see a drop in sales.

Second quarter sales increased by 8.9% to 264,700 units from 243,100 in the same period of last year. This reversed a 5.4% decline in first quarter sales, resulting in a 1.2% rise in first half sales to 531,900 units from 525,500 units a year earlier.

The government is optimistic economic growth will pick up moderately to 5.2% this year, from 4.8% in 2015. The central bank has cut its benchmark rate from 7.5% to 6.5% since the beginning of the year and further cuts are likely in coming months.

Gaikindo has stood by its full year market forecast, made at the beginning of the year, for moderate sales growth of 4-8% to between 1.05-1.1m units, despite declining volumes in the first quarter.