The rupiah weakened against the US dollar in the Jakarta interbank spot market Friday morning on market euphoria over the US government's $837-billion economic stimulus package, Antara reported.
The Indonesian currency was traded at Rp 11,850/11,950 per US dollar on Friday morning. Thursday morning, the rupiah was traded at Rp 11,810/11,860 per US dollar, down 60 points from Rp 11,750/11,775 at the market's close a day earlier.
"The US government's $837 billion stimulus package has given a positive boost to the greenback, which has continued to strengthen against the rupiah," Edwin Sinaga, a money market observer, said here on Friday.
The current US dollar gain was also thanks to the US government's plan to subsidize mortgages in a new front to fight the credit crisis. The plan under consideration would seek to help homeowners before they fall into arrears on their loans.
The positive issue boosted the greenback to advance in the global money market, Edwin said.
Edwin predicted the rupiah would move upward in the run up to the general elections if the elections run peacefully.
In the longer run, the local currency would improve in the future as foreign investors were expected to reenter the domestic market considering the country's economic potentials.
Indonesia, along China and India, is expected to enjoy economic growth despite the global crisis.
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