Rupiah Weakens, Industrial Sector Affected

TEMPO.CO, Jakarta - The rupiah weakened 75 points against the US dollar today, Tuesday, July 2, 2024, to Rp16,391 per US dollar. The rupiah exchange rate on Monday was closed at Rp16,321 per US dollar. 

The Profit Director of Forexindo Berjangka, Ibrahim Assuaibi, said the dollar index was stable against other currencies after recovering from its recent decline on Monday. According to him, the US dollar weakened slightly last week as traders raised their bets on an interest rate cut of 25 basis points in September.

"However, several Fed officials need more confidence in controlling inflation before cutting interest rates," Ibrahim said in his routine analysis on Tuesday.

Domestically, Indonesia's manufacturing Purchasing Managers Index (PMI) fell to 50.7 in June 2024 compared to May’s 52.1. Despite the slowdown, the national manufacturing industry still shows an expansive condition that was sustainable for 34 months until June 2024.

According to Ibrahim, the industrial sector has now entered an alarming state. "Industry players are less optimistic about the upcoming business developments."

In line with a report by the financial analysis and information provider company S&P Global, the national manufacturing sector lost momentum in June 2024 due to several factors. These include increasing output, new demands, to slowing sales. Finally, Indonesia's manufacturing PMI level showed a sharp decline last month. 

Ibrahim said this situation affected the industry's confidence in output for the next 12 months, “which has not moved from its lowest position in 4 years last May, one of the lowest on record." 

ANNISA FEBIOLA

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