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Jakarta Post

Rupiah strengthens as US dollar under pressure

  • News Desk

    The Jakarta Post

Jakarta   /   Fri, January 4, 2019   /   03:15 pm
Rupiah strengthens as US dollar under pressure An employee counts rupiah bills at a money changer in Jakarta on March 14. (Antara/Sigid Kurniawan)

The rupiah strengthened to Rp 14,338 to the United States dollar on Friday, 72 points higher than its position on Thursday, which stood at Rp 14,474 per US dollar, according to the Jakarta interbank spot dollar rate (JISDOR).

“The US dollar is under pressure by other world currencies, including the rupiah, triggered by market players’ concerns over the economic slowdown estimation in the United States,” said securities firm Samuel Sekuritas economist Ahmad Mikail as quoted by Antara.

Ahmad said the Institute for Supply Management’s (ISM) new orders index for the manufacturing sector plunged to 51.1 in December from 62.1 in November.

“It is the lowest since November 2016,” Ahmad said, adding that the slowdown in the US manufacturing industry was triggered by the US-China trade war, among other things.

Meanwhile, Valbury Asia Futures analyst Lukman Leong said the US government shutdown also contributed to the pressure on the US dollar.

“The market sees the US government shutdown has slowed down the country’s economy and triggered the release of assets valued in dollars. The prospects have turned for countries with positive economic indications like Indonesia,” Lukman said.

Lukman said Indonesian economic data, particularly on the inflation rate, which stood at 0.29 percent in December and 3.13 percent for the whole of 2018, was relatively conducive for higher economic growth this year.

Meanwhile, the Jakarta Composite Index (JCI) also strengthen 0.61 percent to 6,256.49 when morning trading closed. (bbn)