Today, Indonesian Rupiah (IDR) showed a bit of increase against U.S Dollar (USD). (Image via: CNBC Indonesia)

Hope for Rupiah!? IDR Strengthens to Rp13,980

Alfonsus Adi Putra
Market & Investment
Foreign Exchange & Interest Rate
Jul 18, 2019
2193
Opening on Thursday (18/7), the spot market noted a strengthening of Indonesian Rupiah’s (IDR) exchange rate at Rp13,980 per U.S Dollar (USD). The rate rose by 0.02% compared to the rate at Rp13,982 on Tuesday (16/7) closing.

Some sentiments caused IDR to falter against USD. President Director of PT Garuda Berjangka, Ibrahim, stated that the uncertainty of Brexit is one of it since the new Prime Minister of UK, Boris Johnson, opposes the idea proposed by the former PM, Theresa May.

However, Brexit was not supposed to take the whole blame. USD grew stronger because of the release of its economic data which shows a positive result. The U.S Department of Commerce tabulated a continuous increase in June’s retail sales by 0.04%, exceeding expectations at 0.01%.

The positive result of the U.S economic data made the possibility of the benchmark interest rate cut by the Federal Reserve (The Feds) smaller. However, do not let your hope down, the probability is still high.

Fortunately, today, USD grew a bit weaker caused by the weakening yield in the U.S government’s obligation. Due to the statement by the International Monetary Fund (IMF) saying that the USD is overvalued by 12% compared to its fundamental economic value.

Ibrahim stated that the market players are still waiting for the result of the Bank Indonesia’s (BI) Board of Governor’s Meeting (RDG) today. The market consensus predicted that BI is going to cut its benchmark interest rate by 25 basis points to 5.75%.

However, do not let your guard down, since BI often disappoints its market players by keeping the benchmark interest rate, even though Indonesia’s macroeconomics’ indicator shows a good result. Indonesia’s balance of payments is the one to blame.

The majority of Asian’s currency strengthened against USD today. Hong Kong Dollar (HKD) strengthened by 0.04%, Malaysian Ringgit (MYR) 0.06%, Singaporean Dollar (SGD) by 0.06%, Philippines Peso (PHP) by 0.07%, Thai Baht (THB) by 0.11%, and Japanese Yen (JPY) by 0.23%. However, South Korean Won (KRW) weakened as much as 0.17%.

Some currencies of developed countries are enjoying a good time against USD such as Australian Dollar (AUD) which strengthened by 0.03%, & European Union Euro (EUR) by 0.11%. However, Great Britain Pound sterling (GBP) remains stagnant.

Source: https://www.cnnindonesia.com/ekonomi/20190718084331-78-413137/rupiah-pagi-ini-menguat-tipis-ke-rp13980-per-dolar-as

Market , Investment , Forex , Indonesia , IDR , U.S , USD