The Jakarta Post
The foreign exchange spot market showed that rupiah strengthened to Rp 14,862 per US dollar at 10:16 a.m. on Tuesday, appreciating 0.77 percent from its position on Monday.
Meanwhile, the Jakarta Interbank Spot Dollar Rate (JISDOR) showed that the rupiah appreciated 0.54 percent to Rp 14,891 per US dollar compared to the day before.
Analyst Faisyal of Monex Investindo Futures said the currency strengthened on positive sentiment from Statistics Indonesia's (BPS) data released on Monday, which recorded a 5.17 percent increase in gross domestic product (GDP) in the third quarter, higher than his estimate of 5.14 percent.
The midterm election in the United States had also caused investors to be more cautious in converting their capital into dollars, Faisyal said as quoted by kontan.co.id, adding that the greenback was also under pressure because of a strengthening trend among European currencies, including the euro.
“One of the [contributing] factors is that the Italian government is ready to compromise with a European committee on its state budget,” he said. Faisyal believed that the rupiah's strengthening trend would continue throughout the day.
Meanwhile, Samuel Sekuritas Indonesia economist Ahmad Mikail also believed that the US midterms had reduced demand for the US dollar. "The investors tended to think that the Democrats would win the election,” Ahmad added.
He estimated that the US dollar index would hover between 96 and 96.30. (bbn)