Update COVID-19 in Indonesia: 70,736 confirmed infections, 3,417 deaths (9 July 2020)
6 July 2020 (closed)
USD/IDR (14,501) +55.01 +0.38%
EUR/IDR (16,343) -41.31 -0.25%
Jakarta Composite Index (5,052.79) -23.38 -0.46%
Most Asian stock indices were up on Tuesday (15/07) influenced by rising indices on Wall Street and in Europe on the previous day. Also for investors on Indonesia’s benchmark stock index (Jakarta Composite Index) this meant an opportunity to engage in stock trading even though the Indonesian rupiah exchange rate depreciated considerably and political uncertainties remain (as the winner of the Indonesian presidential election remains a question mark). In fact, investors were confused to see the Merah Putih coalition.
The Merah Putih coalition is a coalition that consists of seven Indonesian political parties that support controversial presidential candidate Prabowo Subianto. On Monday (14/07), these parties signed an agreement which binds them as a coalition for the next five years. As these seven political parties represent more than half of the seats in the Indonesian parliament, it implies a problem for other presidential hopeful Joko Widodo in case he is declared winner of the election (and the reliable quick count results point in that direction) as he will face difficulty to implement reforms with such a 'hostile' parliament. However, political analysts think that the new coalition can still fall apart after the official result of the presidential election (which will be announced on 22 July).
On Tuesday (15/07), the Jakarta Composite Index climbed 0.99 percent to 5,070.82 points.
Jakarta Composite Index:
The Indonesian rupiah exchange rate depreciated 0.61 percent to 11,736 per US dollar based on the Bloomberg Dollar Index as market participants still prefer to wait for the result of the presidential election first. Moreover, the rupiah was influenced by the two-days of testimony of Federal Reserve Chairwoman Janet Yellen on Capitol Hill (delivering the central bank’s semi-annual report to the US Congress). Ahead of a Federal Reserve meeting or speech, the US dollar always tends to appreciate as market players speculate on an improvement in the US economy.
Bank Indonesia's benchmark rupiah rate (Jakarta Interbank Spot Dollar Rate, abbreviated JISDOR) depreciated 0.70 percent to IDR 11,709 per US dollar on Tuesday (15/07).
Indonesian Rupiah versus US Dollar (JISDOR):| Source: Bank Indonesia