Rupiah Potentially Weakening On Monday, October 23, Here's The Sentiment

JAKARTA. The rupiah exchange rate against the United States (US) dollar has the potential to weaken in trading Monday, October 23 after BI's decision to raise the interest rate by 6 percent.

For information, based on Bloomberg data, the rupiah closed down 0.36 percent to the level of IDR 15,873 per US dollar on Friday, October 20 trading.

Meanwhile, at the Jakarta Interbank Spot Dollar Rate (JISDOR) benchmark rate, Bank Indonesia, the rupiah exchange rate was at IDR 15,856 per US dollar, weakening compared to the previous trade of IDR 15,838 US dollars.

Currency Observer Lukman Leong sees that a slight increase in interest rates by BI will hinder rupiah depreciation.

"However, the US dollar is expected to be difficult to dam amid concerns about the Israel-Hamas war and Powell's hawkish speech last week," Lukman told VOI, Sunday, October 22.

According to Lukman, the strengthening of the US dollar is expected to continue next week which has the potential to reduce the rupiah. In addition, investors are looking forward to data on US Gross Domestic Product (GDP) which is estimated to grow strong 4.1%.

Data on PCE inflation and monthly core PCE inflation are also expected to increase by 0.3 percent and 3.3 percent (YoY) which is still far from the Fed's inflation target of below 2 percent.

Lukman estimates that the rupiah will move on Monday, October 23 trading in the price range of Rp. 15,800- Rp. 15,950 per US dollar.