The rupiah exchange rate in the spot market trading this afternoon, Friday (7/17) weakened 0.53% to a level of Rp. 14,702 per US dollar. The rupiah is also predicted to continue weakening and has the potential to reshape the level of Rp 15 thousand per US dollar next week.

Almost all Asian currencies rose this afternoon. Citing Bloomberg, the Japanese yen rose 0.09%, the Singapore dollar 0.15%, the South Korean won 0.03%, the Philippine peso and the Indian rupee 0.22%, the Malaysian ringgit 0.07%, and the Thai baht 0.03%. While the Chinese yuan fell 0.13% and the Hong Kong dollar did not move significantly.

The Jakarta Interbank Spot Dollar Rate reference rate published by BI at 10.00 WIB also placed the rupiah at the level of Rp. 14,780 per US dollar, down 148 points.

Head of Research and Education Monex Investindo Futures Ariston Tjendra assessed the weakening of the rupiah was driven by BI interest cuts. "This step will reduce yields in Indonesia," Tjendra told Katadata.co.id, Friday (7/17).

Yesterday, the central bank decided to reduce the benchmark interest rate by 25 basis points to 4%. The policy aims to encourage economic recovery that was hit by the corona pandemic.

In addition to the benchmark interest rate, the central bank also lowered the deposit facility alias deposit facility by 25 bps to 3.25% and lending facility 25 bps to 4.75%.

Launching the Worldometers Website

Launching the Worldometers website, positive cases of Covid-19 globally have penetrated 14 million people. The current mortality rate is 593,108 and recovery is 8.3 million people. While in Indonesia, the number of corona cases increased by 1,462 people as of July 17, 2020. Details of the development of the Covid-19 case can be seen in the database below.

Next week, Tjendra estimates that the weakening of the rupiah may continue because of the overall negative sentiment. The potential for the rupiah to weaken to close to Rp 15 thousand per US dollar was exposed.

Nevertheless, he said the market would also still get positive sentiment from the potential for global economic recovery amid the pandemic. Economic data on countries that have released lockdowns generally show economic recovery.

The rupiah exchange rate on the spot market this afternoon, Thursday (7/16), weakened 0.26% to a level of Rp. 14,625 per US dollar. The rupiah exchange rate dropped even though it had opened higher, influenced by recently released Chinese economic data.

Not alone, the Garuda currency weakened along with the majority of other Asian currencies. Citing Bloomberg, the Japanese yen and Hong Kong dollar fell 0.1%, the Singapore dollar 0.27%, the South Korean won 0.41%, the Philippine peso 0.16%, Indian rupees 0.06%, Chinese yuan and Malaysian ringgit 0.16%, and Thai baht 0.43%.

The Rupiah Exchange Rate Remained Under Control by Fundamentals

The Jakarta Interbank Spot Dollar Rate (JISDOR) reference exchange rate published by Bank Indonesia at 10:00 WIB also placed the rupiah at the level of Rp 14,632 per US dollar, down 16 points from yesterday's level.

In addition to the release of varying economic data, negative sentiment also came from heating trade tension between the US and China. The sentiment pressured the Chinese stock index which subsequently gave negative sentiment to Asian regional markets and the opening session of European markets.

BI noted that the rupiah exchange rate remained under control by fundamentals. On a point-to-point basis, Garuda's currency experienced a 14.42% appreciation in the second quarter due to sizable foreign capital inflows in May and June.

Even so, on average it recorded a 4.53% depreciation due to levels that were still weak last April. Until yesterday, the rupiah depreciated 2.28% both in point to point and mean terms compared to the June 2020 level. Meanwhile, when compared to the end of 2019, the rupiah depreciated 4.83%.