Update COVID-19 in Indonesia: 24,538 confirmed infections, 1,496 deaths (28 May 2020)
29 May 2020 (closed)
USD/IDR (14,769) +8.00 +0.05%
EUR/IDR (16,275) +95.18 +0.59%
Jakarta Composite Index (4,753.61) +37.43 +0.79%
The Indonesian rupiah exchange rate continued its recent depreciating trend on Thursday (08/05). According to the Bloomberg Dollar Index, the currency had depreciated 0.36 percent to IDR 11,619 per US dollar at 13:30 local Jakarta time. Apart from market participants' wait and see attitude ahead of results of Bank Indonesia's Board of Governors Meeting, which is held today and will inform whether the current benchmark interest rate of 7.50 percent will be maintained, increased concerns about exports to China also put pressure on the rupiah.
Within the next couple of hours, Indonesia's central bank (Bank Indonesia) will reveal whether it has decided to change or maintain its benchmark interest rate (BI rate, currently at 7.50 percent), the Lending Facility rate (currently 7.50 percent) and the Deposit Facility rate (5.75 percent) at today's Board of Governors Meeting. Most analysts seem to agree that the institution will not change its monetary policy yet. Usually, ahead of a Board of Governors Meeting, the rupiah experiences depreciation.
The other 'problem' for the rupiah is current concern about Indonesian exports to China (Indonesia's largest trading partner). Bloomberg reported that on Wednesday (07/05), the Chinese yuan fell the most in two weeks amid speculation that Chinese policy makers are encouraging exchange rate declines to fend off speculators. A weakening yuan, reduces the competitiveness of Indonesian exports.
Bank Indonesia's benchmark rupiah rate (Jakarta Interbank Spot Dollar Rate, abbreviated JISDOR) depreciated 0.84 percent to IDR 11,624 against the US dollar on Thursday (08/05).