Rupiah Continues to Recover at Wednesday's Start  

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  • TEMPO.CO, Jakarta - The rupiah interbank exchange rate in Jakarta rose by three points at the start of Wednesday's trading session. Rupiah began trading at Rp12,257 per United States (US) dollar, up from its previous position at Rp12,260 per US dollar. 

    The head of research at Monex Investindo Futures, Ariston Tjendra, said on Wednesday that Indonesia's positive economic performance indicators were providing the rupiah the boost it needed to sustain its recoveryparticularly figures relating to Indonesia's trade balance for the month of October. 

    "Indonesia recorded a surplus totalling US$23,2 million in October 2014, indicating that our economy is recovering at a stable rate," said Ariston on Wednesday.

    According to Ariston, Indonesia's economic performance figures will positively affect Indonesia's transactional balance in the fourth quarter of 2014.

    "Bank Indonesia predicts that Indonesia's transactional balance will improve, driven by the growth in exports, which is supported by the general global economic recovery, as well as the declining price of crude oils," said Ariston.

    That said, the rupiah's recovery will remain limited as investors react to the recent release of US manufacturing figures. Furthermore, the rupiah is held back by the positive sentiments echoed in the speech of a Federal Reserve Bank of America's board member, who predicts that declining oil prices will spur the growth of the US economy.

    An analyst for Bank Himpunan Saudara, Rully Nova, added that the rupiah's fluctuation reflected its core fundamentals, which were expected to positively affect Indonesia's trade balance. Consequently, he said, it would help sustain the rupiah's uptrend.

    "The closing deficit gap will help improve Indonesia's economy in the future," said Rully.