Indonesian Deflation Makes Rupiah Undercut Tuesday

JAKARTA - The rupiah exchange rate on the spot market was closed lower on Tuesday, September 1 trading. The rupiah closed slightly lower by 0.07 percent or 10 points to the level of Rp14,573 per US dollar (US).

Monex Investindo Futures Head of Research, Ariston Tjendra, said Indonesia's inflation data for August was minus, holding back the strengthening of the rupiah against the US dollar today.

"Deflation could indicate reduced purchasing power of people who may be affected by the pressure due to the COVID-19 pandemic," said Ariston to VOI.

But overall, he said, the US dollar was weakening against world currencies due to indications of the attitude of the US Central Bank which will maintain loose policy for a longer period of time and may be more aggressive.

In Asia, the rupiah weakened along with the Philippine peso which also weakened 0.20 percent against the US dollar.

Meanwhile, the majority of other Asian currencies strengthened against the US dollar this afternoon. The Indian rupee led the strengthening of Asian currencies against the US dollar with an increase of 1.03 percent, followed by the Malaysian ringgit which strengthened 0.5 percent.

Then the South Korean won strengthened 0.39 percent, the Chinese yuan strengthened 0.36 percent, the Thai baht strengthened 0.35 percent, the Japanese yen strengthened 0.26 percent.

The Singapore dollar strengthened 0.23 percent, the Taiwan dollar strengthened 0.01 percent and the Hong Kong dollar strengthened 0.001 percent against the US dollar.