Indonesia Rupiah Rate Depreciates 0.18% amid Inflation Concern
The Indonesia rupiah exchange rate depreciated 0.18 percent to IDR 12,165 at 16.30 local Jakarta time on Thursday (23/01), based on the Bloomberg Dollar Index. Main reason for this decline is concern that Indonesia's central bank (Bank Indonesia) will maintain its benchmark interest rate (BI rate) at 7.50 percent despite an expected increase in January inflation due to massive floods as well as higher industrial electricity and LPG prices. Indonesia's January inflation rate is estimated to be around 1 percent.
Meanwhile, demand for US dollars in the onshore market persists (despite the less volatile nature of the rupiah as capital inflows continue) according to Irene Cheung, economist at Australia & New Zealand Banking Group Ltd in Singapore in Bloomberg Businessweek.
The central bank's Jakarta Interbank Spot Dollar Rate (JISDOR) depreciated 0.19 percent to IDR 12,173 per US dollar on Thursday (23/01).
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