TEMPO.CO, Jakarta - The rupiah interbank exchange rate in Jakarta went up by 67 points at the end of Wednesday's trading session to close at Rp12,102 per United States (US) dollar, up from its previous position of Rp12,169 per US dollar.
An analyst for Monex Investindo Futures, Zulfirman Basir, said that the US dollar was depreciating under pressure from a number of major global currencies, including the rupiah, as many investors chose to cut their losses by unloading their shares, in anticipation of the upcoming Federal Open Market Committee (FOMC) meeting.
"Fundamentally speaking, the US dollar is not being helped by the recent release of several US economic indicators, many of which remain below market expectations," said Basir.
That said, the rupiah's uptrend remains relatively limited as investors are still keeping an eye on the possibility of a Federal Reserve Bank of America interest rate hike.
"The Federal Reserve is expected to end its obligation buyback program and is rumored to be preparing to raise its core interest rate in mid-2015. That said, if inflation remains worryingly low, then market players will assume that the Fed will not rush to raise its core interest rate," said Basir.
Domestically, investors are also looking at the political dynamics within the House of Representatives (DPR), which is preparing to elect the heads of its Commissions, which will influence the rate at which Joko Widodo's administration could implement its programs and policies, continued Basir.
"The rupiah should remain stable and hover around Rp12,120-Rp12,190 per US dollar," said Basir.
Bank Indonesia's middle rate on Wednesday stood at Rp12,163 per US dollar, down from itsprevious position at Rp12,158 per US dollar.