Rupiah weakens to Rp 14,108 per US dollar on Wednesday
The Jakarta Post
The rupiah weakened to Rp 14,094 against the US dollar on Wednesday, according to the Jakarta Interbank Spot Dollar Rate (Jisdor), 0.53 percent lower than its position on Tuesday. On the spot market, the currency was equally weak, quoted at Rp 14,108 per US dollar at 11:25 a.m. on Wednesday, or 0.50 percent weaker compared to Tuesday’s position.
The currency has depreciated by 3.84 percent since January.
Other currencies that have also weakened against the US dollar include the Hong Kong dollar, Taiwan dollar, Malaysia ringgit and South Korea won.
The US dollar index, which reflects the US dollar's position against other currencies, was at 93.29, strengthening from 93.22 the day before. The dollar index was at its highest level this year, sparked by the increase of the US Treasury yield, which was at 3.06 percent today from 3.07 percent on Tuesday.
Meanwhile, Bank Indonesia’s Board of Governors on Wednesday started its two day-meeting, which among other things, will decide on whether or not to increase its benchmark seven-day reverse repo rate. The central bank has already hinted at increasing the rate.
Bank Central Asia (BCA) economist David Sumual said the rupiah's further depreciation was also sparked by the European Central Bank’s (ECB) reference rate increase and the political tension in the Middle East sparked by the relocation of the US embassy in Israel to Jerusalem.
Valbury Asia Futures analyst Lukman Leong said the US$1.63 billion trade deficit in April also contributed to the rupiah's weakening. “BI’s effort to intervene in the market has become tougher,” said Lukman, as reported by kontan.co.id. (bbn)
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