Indonesia's rupiah fell by the most in a week as the nation posted its fourth monthly trade deficit in January, weighing on the current account. Government bonds dropped as February inflation beat analysts' estimates.

A 1.2 percent drop in exports from a year earlier and a 6.8 percent increase in imports resulted in a shortfall of $171 million, official data showed today. The current-account deficit was $7.8 billion last quarter, the largest in data compiled by Bloomberg going back to 1989, central bank data show. That is 2.8 percent of gross domestic product. Consumer prices rose 5.31 percent from a year earlier, compared with the 4.81 percent median estimate in a Bloomberg survey, data showed today. That was the most since June 2011.

The rupiah fell 0.1 percent to 9,675 per dollar as of 10:33 a.m. in Jakarta, the most since Feb. 21, prices from local banks compiled by Bloomberg show. It gained 0.3 percent this week and 0.8 percent in February, the biggest advance since January 2012. One-month non-deliverable forwards declined 0.1 percent to 9,685, a 0.1 percent discount to the spot rate, data compiled by Bloomberg show.

"Exports likely remained weak as January-February is seasonally weak," Prakriti Sofat, a regional economist at Barclays Plc in Singapore, said before the data was released. "We maintain our year-end rupiah forecast of 9,900, given a structural current-account deficit, weak terms of trade and a higher political risk premium."

A daily fixing used to settle rupiah derivatives was set at 9,669 yesterday, from 9,687 on Feb. 27, by the Association of Banks in Singapore. One-month implied volatility in the rupiah, which measures expected moves in the exchange rate used to price options, dropped seven basis points, or 0.07 percentage point, to 5.79 percent.

Bonds decline

"We expect Indonesia to return to its pre-Asian crisis norm of running annual 2 percent to 3 percent of GDP current account deficits," Tim Condon, head of research for Asia at ING Groep NV in Singapore, wrote in a note today.

The yield on the government's 5.625 percent bonds due May 2023 rose eight basis points this week to 5.36 percent, prices from the Inter Dealer Market Association show. The rate was advanced one basis point today.