TEMPO.CO, Jakarta - The weakening of the US dollar in global markets and optimism on the new president pushed the rupiah. In yesterday's money market transaction, the rupiah gained 78 points (0.64 percent) to close at 12,032 per US dollar, in line with other Asian currencies that rose against the greenback.
Jiniman, an economist from Bank Internasional Indonesia, said the rupiah appreciated against a corrected greenback. The money market was also bullish on expectations of Indonesia's seventh president, Joko Widodo.
"The market is optimistic that the economy will get better," Juniman said yesterday.
Since last week, the US dollar has weakened against major currencies on speculations that the Federal Reserve will delay its interest rate hikes due to a global economic slowdown that may disrupt America's economic recovery. The Fed initially planned to raise its key rates in mid-2015.
As for the Jokowi effect, Juniman estimated the euphoria will not last, because the market is more concerned about the new government's ministerial posts.
The market, he said, will wait to see if Jokowi is able to deliver his promises to boost economic growth to above seven percent and promote infrastructure development, maritime construction, and cut fuel subsidies.
For today, Juniman estimated the exchange rate at Rp12,020 to Rp12,100 per dollar. However, the rupiah's movement is dependent on the release of China's GDP data and the cabinet announcement today.
"After the cabinet announcement, the market will focus on the work program of Jokowi's administration," he said.
PDAT | M. AZHAR