Jakarta – Recent strengthening in Indonesia's rupiah currency has been mainly due to external factors, central bank deputy governor Budi Mulya said on Tuesday.

The rupiah hit 10,900 per dollar at 0700 GMT on Tuesday, up around 6 percent from Friday's close. The currency market was shut on Monday for a public holiday.

The rupiah has gained around 20 percent since it hit a 10-year low at 13,100 on Nov. 21, buoyed by foreign capital inflows into the bond and stock markets as the central bank has cut interest rates to stimulate economic growth.

"The rupiah strengthening is mainly because of external factors," Budi Mulya told reporters on the sidelines of a parliamentary hearing. The financial market "is not always bearish. Sometimes it is bullish," he said.

Indonesian policymakers have been scrambling to contain market turmoil sparked by investor fears that the currency could become the next casualty of a worldwide capital flight from risky assets.

The central bank cut its key rate by 25 basis points to 9.25 percent on Dec. 4 in a bid to protect the economy in the face of a severe global downturn.

[Reporting by Adriana Nina Kusuma; Writing by Tyagita Silka; Editing by Neil Fullick.]