TEMPO.CO, Jakarta - Rupiah's interbank exchange rate in Jakarta slid by 107 points on Monday evening, to close at Rp12,155 per United States (US) Dollar at the end of trading - down from its' previous position at Rp12,048 per US dollar.
"The US Dollar is still rallying against the Rupiah following the release of economic data that suggests that its' Gross Domestic Product (GDP) grew by 4,6 percent in the second quarter of 2014 - up from the same period in the previous year," said Monex Investindo Future's Head of Research, Ariston Tjendra in Jakarta on Monday.
Ariston said that US' GDP growth is supported by healthy exports, business investments, and increased spending by US citizens on the health sector - although it is slightly evened out by a decrease on spending in other services sector.
"The biggest contributor to the gain is through business investment, which should bring positive sentiments for the US economy at least for the next few months," said Ariston.
According to him, US GDP data shows which shows a healthy economic growth will give the Fed all the more reason to increase its' main interest rate even sooner than it had previously signalled.
Furthermore, geopolitical instability which has resurfaced in the Middle East and Russia have pushed many investors to seek to invest in US Dollars as it is perceived as a 'safe haven' currency that provides a buffer against possible economic shocks.
US airstrikes against the hardline Islamist militant group Islamic State (IS) and Russia's plan to pass a law that allows it to seize foreign assets are also pushing investors to let go of 'riskier' currency investments in favour of safer options such as the US Dollar.
Meanwhile, an analyst from Bank Himpunan Saudara, Rully Nova, said that Rupiah could recover some of its' losses - albeit only to a limited extent - following the imminent release of September's inflation figures by the Central Statistics Agency (BPS) in early October 2014.
"It is hoped that September's inflation figures would be stable enough, which will allow the rupiah to better defend its' value against other currencies," said Rully.
Bank Indonesia's middle rate on Monday slid to Rp12,120 - down from yesterday's position of Rp12,007 per US Dollar.