Rupiah Stabilizing at 9,700

TEMPO.CO, Jakarta - The rupiah has been moving sideways in the past three days, edging up and down in the narrow range of Rp9,715 to Rp9,725 per US dollar. An array of negative sentiments from the global market, coupled with the trade balance deficit, has been keeping the rupiah stagnant at around Rp9,700 per US dollar. On Wednesday's trade, the rupiah edged up by 0.05 percent closing at Rp9,718 per US dollar.

Money market analyst Lindawati Susanto said that in general, the rupiah is still moving in a limited range. Albeit the improving global economy, the rupiah remains stagnant at Rp9,700 per dollar. "However, there are indications that the rupiah is beginning to stabilize at current levels," she said yesterday.

Fluctuating external sentiments and the increasing demand for US dollars in the domestic market is preventing the rupiah from appreciating. Towards the end of the month, dollar demand from corporates will increase as companies must pay their import duties. The demand is expected to reach its peak this weekend.

The rupiah is expected to strengthen at the beginning of the month following a decline in domestic dollar demand. However, there is still the threat of inflation that stems from the price adjustment of subsidized fuel.

Today, the rupiah is expected to move in the range of Rp9,690 to Rp9,720 per US dollar.

PDAT | M AZHAR