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Rupiah falls to 11-month low
Indonesiaâs rupiah fell to the weakest level in almost 11 months as reports showed exports contracted more than forecast and inflation accelerated
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ndonesia's rupiah fell to the weakest level in almost 11 months as reports showed exports contracted more than forecast and inflation accelerated.
Overseas sales dropped 2.21 percent in October from a year earlier, data showed on Monday, compared with the 1.45 percent decline projected in a Bloomberg survey. Imports also fell 2.21 percent, resulting in a US$23 million trade surplus. Inflation quickened to a five-month high of 6.23 percent in November, separate figures showed on Monday, and a gauge of the nation's manufacturing fell to a record last month.
The rupiah dropped 0.6 percent to close at 12,275 per dollar, prices from local banks show. The currency touched 12,277 earlier, the weakest level since Jan. 7. In the offshore market, one-month non-deliverable forwards declined 0.4 percent to 12,353, according to data compiled by Bloomberg. Bank Indonesia set a fixing used to settle the contracts at 12,264, from 12,196 on Nov. 28.
'Today's data is rather negative for the rupiah,' said Toru Nishihama, an economist covering emerging markets at Dai- ichi Life Research Institute Inc. in Tokyo. 'Import data show domestic demand remains sluggish, while exports are decreasing, indicating a weak economic outlook.'
Indonesia's current account has been in deficit for the last 12 quarters and today's trade data won't bring much relief. Southeast Asia's largest economy expanded 5.01 percent in the three months through September from a year earlier, the slowest pace in five years. A manufacturing gauge for November released today in China, Indonesia's largest export market, fell to an eight-month low.
'The current-account deficit is unlikely to improve significantly due to weak global demand,' Saktiandi Supaat, head of foreign-exchange research at Malayan Banking Bhd. in Singapore, said before the trade data was released.
The yield on Indonesia's 8.375 percent sovereign bonds due March 2024 declined one basis point, or 0.01 percentage point, to 7.69 percent, prices from the Inter Dealer Market Association show. That's the lowest level since Oct. 31, 2013. (***)
