Rupiah Edges Up with Forex Increase
12 June 2014 00:14 WIB
TEMPO.CO, Jakarta - The rupiah edged up on yesterday's trade, closing 4.8 points (0.04 percent), to Rp11,810 per US dollar. Bank Mandiri analyst Reny Eka Putri the rupiah's slight gain was the impact of an increasing foreign exchange (forex) reserves.
Bank Indonesia (BI) reported that forex reserves in May 2014 increased to US$107.0 billion. The announcement prompted investors to purchase rupiah-denominated assets. "As evidence, the last State Bonds (SUN) auction successfully absorbed Rp12 trillion," Reny said.
However, Reny said that the rupiah movement is still overshadowed by negative sentiments from the trade balance deficit. The deficit, which amounts to US$1.9 billion dollar, increases the market's concern about the US dollar liquidity.
Reny said that the rupiah will have difficulties to move in a positive direction, as The Federal Reserve plans to raise interest rates ahead of schedule. The US dollar is expected to strengthen against global currencies, driven by increasing demand as a safe haven currency.
"The World Bank's revised projection of the global economic growth will persuade some investors to make the dollar as a safe haven," she said.
Today, the rupiah is still expected to weaken against the dollar, moving in a limited range of Rp11,785 to Rp11,830 per US dollar.
MEGEL JEKSON