Indonesian stocks and the rupiah performed well on the day that President Joko Widodo announced his cabinet reshuffle, while Japan announced a larger-than-expected economic stimulus package to boost the local economy. The benchmark stock index of Indonesia (Jakarta Composite Index) surged 0.96 percent to 5,274.36 points, while the Indonesian rupiah appreciated 0.29 percent to IDR 13,137 per US dollar (Bloomberg Dollar Index) on Wednesday (27/07). Lets take a closer look.

Lanjut baca ›

Positive sentiments caused by the Group of 20 economies meeting in China have waned, hence most Asian stocks are lower on Tuesday (26/07). Instead, negative sentiments are caused by falling shares on Wall Street overnight as well as the declining crude oil price (touching a near three-month low). Market participants are also in 'wait and see-mode' ahead of the Federal Reserve's July two-day policy meeting (that starts later today) and the two-day policy meeting of the Bank of Japan that starts on Thursday.

Lanjut baca ›

After a five-day winning streak in the post-Brexit era, the majority of Asian shares fell on Tuesday (05/07) as investors are engaging in profit-taking after the recent rally. Not even rising expectation of more stimulus measures from several key central banks around the globe managed to entice investors and boost appetite for stocks. Crude oil also fell on concerns over the global economy. Meanwhile, the safe haven assets gold and Japan's yen strengthened, while government bond yields fall to unprecedented levels. Indonesian markets are still closed for the Idul Fitri holiday (4 - 8 July 2016).

Lanjut baca ›

The central bank of Indonesia (Bank Indonesia) cut its key interest rate (BI rate) by 0.25 percentage point to 6.50 percent at Thursday's policy meeting (16/06). Although the central bank had stated at its preceding policy meeting that there remained room for monetary easing, today's move was a surprise that few analysts saw coming. The 7-day reverse repurchase rate, which is set to become the central bank's new benchmark rate on 19 August, was also cut by 25 basis points (to 5.25 percent) at today's policy meeting.

Lanjut baca ›

It was a bad start of the new trading week. Stocks in Asia were deep in the red due to risk aversion, falling the most in four weeks amid concern about the "Brexit" referendum, uncertainty before this week's central bank meetings in the USA and Japan, falling crude oil prices, and the worst mass shooting in modern US history. Indonesia was among the affected markets; the benchmark Jakarta Composite Index fell 0.84 percent to 4,807.23 on Monday (13/06), while the rupiah only depreciated slightly to IDR 13,298 per US dollar (Bloomberg Dollar Index).

Lanjut baca ›

In line with other markets in Asia, Indonesian stocks and the rupiah continued to rally on Tuesday (07/06) supported by the cautious words of Federal Reserve Chair Janet Yellen in a speech on Monday. Meanwhile, higher commodity prices boost the outlook for those commodity-exporting economies (including Indonesia). Indonesia's benchmark Jakarta Composite Index rose 0.78 percent to 4,933.99 points, while the Indonesian rupiah appreciated 0.80 percent to IDR 13,263 per US dollar (Bloomberg Dollar Index).

Lanjut baca ›

Changing perceptions about US monetary policy have a big impact on Indonesian stocks and - especially - the rupiah, today. According to the Bloomberg Dollar Index, the Indonesian rupiah had appreciated 1.30 percent to IDR 13,418 per US dollar by 12:55 pm local Jakarta time. Meanwhile, the Jakarta Composite index rose 0.52 percent to 4,879.06 after the first trading session on Monday (06/06). What caused this performance? Well, the release of the weakest US jobs data since 2010.

Lanjut baca ›

On 5 June 2016, Indonesia Investments released the latest edition of its newsletter. This free newsletter, which is sent to our subscribers once per week, contains the most important news stories from Indonesia that have been reported on our website over the last seven days. Most of the topics involve economic matters such as Indonesia's fiscal credibility, inflation, manufacturing activity, the impact of a possible US interest rate hike, credit ratings, slavery, crude oil, and more.

Lanjut baca ›

The Indonesian rupiah experienced a volatile day on Thursday (02/06), touching a four-month low in the morning after Indonesia failed to get investment grade status (yet) from global credit rating agency Standard & Poor's (S&P). However, at the end of the trading day the rupiah had appreciated 0.13 percent to IDR 13,643 per US dollar (Bloomberg Dollar Index). Most emerging Asian currencies appreciated against the US dollar today amid uncertainty about an imminent Fed Funds Rate hike.

Lanjut baca ›

For sure Indonesia's financial system will be affected by the Federal Reserve's decision to implement another interest rate hike, and especially emerging market currencies - including the rupiah - are vulnerable to further monetary tightening in the world's top economy. Most analysts now believe a Fed Funds Rate (FFR) hike could occur in July 2016. In previous rounds of US monetary tightening (QE tapering and the December 2015 FFR hike) we witnessed large capital outflows from Indonesia. What will be the impact of another US interest rate hike on Indonesia?

Lanjut baca ›

Indonesia's benchmark interest rate (BI rate) is expected to be maintained at 7.50 percent at Bank Indonesia's Board of Governor's Meeting on Tuesday 8 April 2014. Despite Indonesia's moderating inflation rate (7.32 percent year on year in March 2014) and the February 2014 trade surplus of USD $785 million, the BI rate may be left unchanged in order to support the further easing of Indonesia's current account deficit and to offset the impact of the possible US interest rate hikes in 2015 and 2016.

Lanjut baca ›

At 15:00 local Jakarta time on Tuesday (01/04), the Indonesian rupiah exchange rate as well as the country's benchmark stock index (known as the IHSG or Jakarta Composite Index) have shown a positive performance so far. Based on the Bloomberg Dollar Index, the rupiah appreciated 0.64 percent to IDR 11,288 per US dollar, while the IHSG climbed 2.15 percent to 4,871.38. A number of internal and external factors contributed to this remarkable performance today.

Lanjut baca ›

By the end of Friday's trading day (28/03), the Indonesian rupiah exchange rate appreciated 0.75 percent to IDR 11,361 per US dollar based on the Bloomberg Dollar Index. At the end of March 2014, the rupiah is still the best-performing Asian currency this year, outperforming 24 emerging-market currencies that are tracked by Bloomberg. Since 31 December 2013, the rupiah appreciated nearly seven percent against the US dollar as an easing current account deficit and slowing inflation triggered capital inflows into Southeast Asia's largest economy.

Lanjut baca ›

The Indonesian rupiah exchange rate depreciated 0.31 percent to IDR 11,447 per US dollar on Thursday (27/03) based on the Bloomberg Dollar Index. The currency's strong performance in February and the first half of March, supported by Indonesia's easing current account deficit and inflation, has met resistance due to global concern about the aggressive US Federal Reserve monetary tightening (winding down its quantitative easing program by another chunk of USD $10 billion as well as possible US interest rate hikes in 2015 and 2016).

Lanjut baca ›

Today (18/03), the World Bank released the March 2014 edition of its Indonesia Economic Quarterly (IEQ), titled Investment in Flux. The report discusses key developments over the past three months in Indonesia’s economy, and places these developments in a longer-term and global context. Secondly, it provides a more in-depth examination of selected economic and policy issues, as well as analysis of Indonesia’s medium-term development challenges. Click here for further information about the World Bank and its activities in Indonesia.

Lanjut baca ›

The Indonesian rupiah exchange rate continued its impressive rebound in 2014, supported by Indonesia's improving economic fundamentals as well as increased political certainty due to the nomination of Joko Widodo (Jokowi) as the main opposition party's (PDI-P) presidential candidate. As such, the 'Jokowi effect' managed to offset negative market sentiments brought on by the (disputed) referendum in Crimea that showed that 97 percent of voters support a split from Ukraine. This intensified political tensions between the West and Russia.

Lanjut baca ›

The central bank of Indonesia (Bank Indonesia) believes that the USD $430 million trade deficit that was recorded in January 2014 is a normal result taking into account the implementation of the ban on exports of unprocessed minerals (which reduces exports of materials such as copper and nickel) and seasonal trends as exports are always lower in January than in December due the end of winter peak demand for raw materials and ongoing contractual negotiations at the beginning of each year.

Lanjut baca ›

The Indonesian rupiah exchange rate had depreciated (0.15 percent) to IDR 11,665 per US dollar on Thursday (27/02), 15:00 local Jakarta time, based on the Bloomberg Dollar Index. Governor of Bank Indonesia Agus Martowardojo stated yesterday to expect the currency to stabilize near current levels in line with its economic fundamentals ahead of looming further Federal Reserve tapering. Analysts estimate that Indonesia's trade balance might deteriorate in January 2014 as the impact of the mineral-ore export ban kicks in.

Lanjut baca ›

The central bank of Indonesia (Bank Indonesia) is optimistic that the country's currency will continue to appreciate against the US dollar in the first quarter of 2014. Executive Director at the Economic and Monetary Policy Department of Bank Indonesia Juda Agung said that there are two factors that impact positively on the performance of the Indonesian rupiah exchange rate: the improved global economy and strengthening domestic economic fundamentals. However, Agung declined to estimate the value of the rupiah by the end of Q1-2014.

Lanjut baca ›

Positive market sentiments stemming from Wall Street pushed Indonesia's benchmark stock index (known as the Jakarta Composite Index or IHSG) further up on Wednesday (12/02). Even though technical indicators (such as the bollinger band) suggest that the majority of Indonesian stocks are close to the overbought area, it did not prevent investors from stock trading. The appreciating rupiah exchange rate, rising Asian indices and positive openings in Europe all contributed to the IHSG's 0.58 percent gain to 4,496.29 points.

Lanjut baca ›