The Rupiah strengthened significantly after BPS released the Indonesian Trade Balance which experienced a surplus of 540 million US dollars in March 2019. The Rupiah exchange rate strengthened significantly against the US Dollar on Monday afternoon. Based on the TradingView chart at 14.00 WIB, the Rupiah moved from yesterday's closing level at the level of IDR 14,152 to IDR 14,065 per USD.

Trade Balance Boosts Rupiah

The strengthening of the Rupiah has become even stronger after the release of Indonesia's trade balance report by the Central Statistics Agency (BPS). In the release of the data, Indonesia's Trade Balance experienced a surplus of 540 million US Dollars in March 2019, bigger than the previous period's surplus of nearly 330 million US Dollars. Exports declined by 10.01% year-on-year (YoY), accompanied by imports which also fell 6.76% YoY.

"If we combine the value of exports and imports, the March trade balance will have a surplus of 0.54 billion dollars, or 540 million US dollars. We hope that the following months will experience a surplus, because the government has made policies to spur exports and otherwise control imports. "explained the Head of BPS, Suhariyanto, quoted from Antara.

According to Asia Tradepoint Future analyst, Deddy Yusuf Siregar, market optimism towards the release of the Trade Balance indeed triggered an increase in the Rupiah versus the US Dollar. He added that President Joko Widodo's statement in the Presidential Election Debate on Saturday (13 / April) yesterday also had a significant impact. In the debate, Jokowi stated that the Trade Balance Deficit improved compared to figures as of February.

"Today there is still the potential for the Rupiah to strengthen in the range of Rp14,020 to Rp.14,070 per US Dollar. Especially if Monday oil prices on the US market again weaken, this has a positive impact on the Rupiah," explained Deddy as quoted by CNNIndonesia.

US Start Softening Against China

External factors also played a significant role in strengthening the Rupiah today. The United States has reportedly begun to soften in trade negotiations with China, and is willing to reduce its demands to China. This is what triggers investors to return to eager to hunt down risk assets in developing countries. "If US negotiators define success (negotiation) as changing the way the Chinese economy operates, it will never happen. The agreement that makes Xi look weak will not be taken by him. Any agreement we get will be better than what we already have "It will not be enough for some people, but indeed that is how politics is ...," said the source who did not want to be named by Reuters.

Rupiah Strengthens After Holiday

USD / IDR opened with a big gap, because the Indonesian market was reopened after the national holiday yesterday. It opened at 14,185, and was at its highest at 14,232, currently trading at 14,175. The rupiah strengthened against the dollar which weakened broadly.The latest developments in US-China trade, White House economic adviser Larry Kudlow told reporters yesterday that "making good progress,". However, according to Bloomberg news, both parties have not agreed on import duties on Chinese goods in the US based on the provisions of law enforcement mechanisms.

Meanwhile, the ISM non-manufacturing PMI and service sector PMI data in the US for March scored lower than expectations at 56.1, expectations of 58 from 59.7 earlier, 18-month lows though although still consistent with a reasonable growth momentum. US data continues to show weakness in the US economy, dragging the Dollar down and weakening against most Forex currencies. NFP is the main event that will attract much attention which will be released tomorrow at 19:30 WIB. While the FXStreet economic calendar displays expectations for NFP of 180 thousand.