TEMPO.CO, Jakarta - The rupiah interbank exchange rate slid by nine points on Monday evening, down to Rp12,094 per United States (US) dollar from Rp12,085 per US dollar.
"Indonesia's continued transactional deficit has driven the rupiah towards the red zone, after initially climbing in today's morning session," said Rully Nova, a market analyst for Bank Himpunan Saudara.
Rully explained that Indonesia's transactional deficit of US$270,3 million in September 2014 was sparking worries about the state of the Indonesian economy among investors in the region.
On the other hand, continued Rully, the lack of positive boost, both internally and globally, continues to pressure the rupiah's exchange rate in the market. Internally, market players are waiting for the government to affirm its commitment to cutting fuel subsidies. Externally, uncertainties surrounding the Fed's plan to raise its core interest rate are also putting a damper on the rupiah's uptrend.
"The rupiah's downtrend is currently caused by its less-than-desirable fundamentals," said Rully.
An analyst for Monex Investindo Futures, Zulfirman Basir, added the US dollar is appreciating following the release of satisfactory manufacturing figures, as well as positive consumer confidence figures, which seem to suggest that the US economic recovery is indeed on the right track.
Furthermore, the decline in both manufacturing and non-manufacturing activities in China is adding pressure on Asian currencies, which include the rupiah. A declining manufacturing figure in China is stirring worries among investors in relation to Indonesia's capacity to address its transactional deficit.
"China is one of Indonesia's main trading partners, so a disruption in China will surely be reflected in Indonesia's export outlook," said Basir.
Bank Indonesia's middle rate on Monday stood at Rp12,105 per US dollar, down from its previous position at Rp12,082 per US dollar.