The rupiah traded among banks in Jakarta on Friday morning weakened by 11 basis points to Rp 11,705 per US dollar
The rupiah traded among banks in Jakarta on Friday morning weakened by 11 basis points to Rp 11,705 per US dollar.
Monex Investindo Futures analyst Zulfirman Basir said that because market players were worried about the escalating conflict in Ukraine, currencies in emerging markets were weakening.
"Ukraine accuses Russia for attacking the border area and this diminishes hope for a peaceful solution. Continuous conflicts will hamper the growth of the global economy," Zulfirman said in Jakarta on Friday as quoted by Antara news agency.
He also said that investors were observing the country's political condition with caution, as market players were waiting to see whether the new Cabinet would receive adequate support from the the legislature.
According to Zulfirman, market players believe that president-elect Joko "Jokowi" Widodo will need this support in the legislature in order to implement his programs.
"The rupiah will be traded between Rp 11,670 per dollar and Rp 11,725 per dollar throughout the day," he added.
Separately, Bank Himpunan Saudara analyst Rully Nova said that drivers in the domestic market were limited at the moment, forcing the domestic currency to continue to depreciate.
However, he said that the fluctuation remained stable.
"Market players are waiting for when the government increases the price of subsidized fuel. Thus, they are using the US dollar for most of their share-trade transactions," Rully said.
He added that a number of investors were worried about the US central bank's plan to immediately increase the Fed rate following improvement in the US economy.
"The rise of the Fed rate impacts emerging markets negatively, including the rupiah," he continued. (nfo)
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