Rupiah Slides to Rp12,115 per US Dollar on Friday Morning
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Jumat, 31 Oktober 2014 18:24 WIB
TEMPO.CO, Jakarta - The rupiah interbank exchange rate in Jakarta fell by 33 points on Friday morning, down to Rp12,115 per United States (US) dollar from Rp12,082 per US dollar.
"The US dollar is moving back into the green, fueled by the growth of the US economy throughout the third quarter of 2014, which drives investors to seek out US dollar-denominated investments," said the head of research at Monex Investindo Futures, Ariston Tjendra.
Ariston said the US Department of Trade recorded that the US' Gross Domestic Product (GDP) grew by 3.5 percent in the third quarter of 2014, exceeding previous expectations that set the growth target at 3 percent.
The figures support the Fed's statement that the US economic recovery is, for the most part, on the right track, continued Ariston. As such, it opens up the possibility that investors could shift their focus away from riskier markets, including Indonesia.
The head of research at Woori Korindo Securities Indonesia, Reza Priyambada, said the decision reached at the Federal Open Market Committee (FOMC) to stop its quantitative easing program contributed to the slowdown experienced by the rupiah.
"The rupiah is on a downtrend as the US dollar continues to appreciate following the Fed's decision to end its obligation buyback program," said Reza, who continued to say that there was a lack of external boost to support the uptrend of the rupiah, which was also burdened by uncertainties surrounding the government's plan to cut fuel subsidies.
"Existing sentiments are not providing the rupiah the boost it needs to sustain an uptrend. Once the government confirms that it will commit to the planned subsidy cuts, the rupiah will have some room to move as the cuts are expected to reduce Indonesia's transactional deficit," said Reza.
ANTARA