Update COVID-19 in Indonesia: 365,240 confirmed infections, 12,617 deaths (19 October 2020)
19 October 2020 (closed)
USD/IDR (14,690) +0.00 +0.00%
EUR/IDR (17,369) +0.00 +0.00%
Jakarta Composite Index (5,126.33) +22.92 +0.45%
Based on Bank Indonesia's benchmark rupiah exchange rate (Jakarta Interbank Spot Dollar Rate, abbreviated JISDOR), the Indonesian rupiah exchange rate depreciated 0.44 percent this week. Although Asian currencies have been largely supported by renewed capital inflows as investors are optimistic that central banks across the globe continue to provide stimulus to boost local economies, the rupiah has been under pressure due to various domestic issues. These issues include politics as well as fuel subsidies.
Indonesia's upcoming presidential election on 9 July 2014 has been a negative influence on the rupiah after Golkar - the second largest political party based on the result of the April legislative election - decided to join the coalition that backs controversial presidential candidate Prabowo Subianto. As such, the political support base for Subianto is larger than that of highly popular Joko "Jokowi" Widodo. Golkar's step increases political uncertainties in Southeast Asia's largest economy and thus investors have become careful, preferring to wait & see first. On various occasions, the market has indicated that it supports Jokowi to become Indonesia's next president.
Secondly, investors are concerned about Indonesia's public finances after the government announced the need for an increase of this year's fuel subsidies. The government proposes to add IDR 74 trillion (USD $6.4 billion) to fuel subsidies in the revised 2014 State Budget to a total of IDR 284.9 trillion (USD $24.8 billion). Earlier this week, Indonesian Finance Minister Chatib Basri said that Indonesia will increase bond sales by IDR 69 trillion to finance the 2014 budget deficit forecast at 2.5 percent of gross domestic product (GDP). Previously, the government estimated the budget deficit at 1.69 percent.
Lastly, the market is waiting for further economic data that will provide more information about the state of the Indonesian economy. On Monday 2 June 2014, Statistics Indonesia (BPS) will release inflation, manufacturing and trade data.
Based on the Bloomberg Dollar Index, the rupiah had depreciated 0.10 percent to IDR 11,644 per US dollar at 3pm local Jakarta time on Friday (30/05).
Bank Indonesia's benchmark rupiah rate (Jakarta Interbank Spot Dollar Rate, abbreviated JISDOR) appreciated 0.02 percent to IDR 11,611 against the US dollar on Friday.
Indonesian Rupiah versus US Dollar (JISDOR):| Source: Bank Indonesia