Singapore Dollar turned stronger against Rupiah this afternoon. (Credit : CNBC)

RI CAD is swollen, Singapore Dollar strengthens over Rupiah

Siti Fatimah Adri
Politics & Economic
News Flash Indonesia
Aug 09, 2019
1946
Having weakened against Rupiah this morning, Singapore Dollar turned stronger against Rupiah this afternoon.

Quoting data from Refinitiv, on Friday (9/8/2919) at 13:05 West Indonesia Time, currency of the State of Merlion was at Rp 10,278.68 or rose slightly 0.02% on the spot market. Even though this morning, Singapore dollar had weakened to Rp 10,257.34.

According to Trading Economics, economic data from Singapore showed April retail sales rose 0.5%, better than stagnant consensus of 0%. The release is likely to be a positive sentiment for the Singapore dollar.

Rupiah itself actually also received positive sentiment with increase in consumer confidence index to 128.2. According to Trading Economics data, this increase is the highest since the data began to be recorded since June 2000.
BI reported that the current account in second quarter of 2019 posted a deficit of US $ 8.4 billion, equivalent to 3.04% of Gross Domestic Product (GDP). Deeper than the first quarter of 2019 which was only US $ 7 billion (2.6% of GDP) and the second quarter of 2018 which amounted to US $ 7.9 billion (3.01% of GDP).

The swelling of current account deficit, according to BI, is influenced by several factors, such as repatriation of dividends and interest payments on foreign debt, the impact of a slowdown in the world economy, and falling commodity prices.
Overall Indonesia's balance of payments (NPI) in the second quarter of 2019 also posted a deficit of US $ 1.98 billion. Even though the balance of payments still recorded a surplus of US $ 2.4 billion in the previous quarter.

In addition to the swelling of the CAD, the deficit in the balance of payments this time was also caused by a decrease in the performance of financial transactions. This transaction only recorded a surplus of US $ 7 billion in the second quarter of 2019. Much smaller than the previous quarter's surplus of US $ 9.9 billion.

This data is makes Rupiah depressed by Singapore dollar. Because the NPI deficit shows that foreign exchange supply in the national economy is sluggish, more is coming out than is entering.

Source: https://www.cnbcindonesia.com/market/20190809132622-17-90920/cad-ri-bengkak-dolar-singapura-balik-tekan-rupiah