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Rupiah slumps to trade 15,619 per US dollar

Tempo - December 16, 2022

Bisnis, Jakarta – The rupiah was corrected further down against the US dollar in Thursday's trade, December 15, 2022. The rupiah closed 0.17 percent down to trade for 15,619 per US dollar as the greenback index gained 0.22 following The Fed's announcement of another 50-bps interest rate hike.

Other Asian currencies that also weakened in today's trade were the Chinese yuan and Hong Kong dollar which fell 0.24 percent and 0.01 percent respectively, as well as the Indian rupee, Malaysian ringgit, and South Korean with 0.15 percent, 0.43 percent and 0.61 percent correction. The Japanese yen on the other hand showed strength against the US dollar with a gain of 0.40 percent.

Laba Forexindo Berjangka director Ibrahim Assuaibi said the US dollar index immediately shot up following the 50-bps Fed Rate hike announcement. Markets responded to the policy by predicting a longer era of high interest rates.

"The market expects US interest rates to peak below 5 percent in May next year, lower than what the Fed has been guiding," Ibrahim said in his daily research, Thursday, December 15.

Other factors contributing to the rupiah correction included Fitch Rating's decision yesterday to keep the Indonesian Sovereign Credit Rating at investment grade BBB with a stable outlook.

Ibrahim predicted the rupiah will continue to fluctuate on Friday. "The possibility is [the rupiah] will open with a fluctuation but closed lower in the range of 15,600 to 15,650 per US dollar," he said.

Source: https://en.tempo.co/read/1668848/rupiah-slumps-to-trade-15619-per-us-dolla