Indonesia’s rupiah extends losses past 17,700 per US dollar amid strong greenback demand and rising global oil prices.
JAKARTA: Indonesia’s rupiah extended its losses on Wednesday, weakening further beyond the 17,700 rupiah-per-US-dollar level amid strong demand for the greenback and rising global oil prices.
The rupiah depreciated by 37 points, or 0.21 per cent, to 17,743 rupiah against the US dollar on Wednesday morning after closing at 17,706 rupiah on Tuesday.
Coordinating Minister for Economic Affairs Airlangga Hartarto said strong demand for the US dollar was among the key factors behind the rupiah’s depreciation.
“Global factors are also having a significant influence and, as I mentioned, during the hajj period, demand for the dollar is also high,” he said, according to ANTARA News Agency on Tuesday night.
Airlangga said demand for the US dollar had also risen during this period due to corporate dividend payments following the annual financial reporting season.
He said the pressure on the rupiah was compounded by rising global oil prices amid unresolved tensions between the United States and Iran.
“After the financial reports, dividend payments are mostly made during these months. So demand is indeed high. Plus, oil prices are still rising,” he said.
Airlangga said the combination of robust US dollar demand and rising global oil prices had created strong external pressure on the rupiah.
He also expressed hope that the rupiah would strengthen in the second half of the year.
Similarly, Indonesia’s benchmark Composite Stock Price Index (IHSG) fell 18.48 points, or 0.29 per cent, to 6,352.20 at the opening of trade on Wednesday.
The LQ45 index, which tracks 45 leading stocks, edged up 0.19 points, or 0.03 per cent, to 635.01.
