Rupiah Potentially Weakening Due To Global Uncertainty

JAKARTA - The rupiah exchange rate in trading Tuesday, September 24, 2024 is expected to weaken against the United States (US) dollar.

Quoting Bloomberg, the Rupiah exchange rate on Monday, September 23, 2024, the rupiah exchange rate on the spot market closed down 0.37 percent at the level of Rp. 15,206 per US dollar.

Meanwhile, the Jakarta Interbank Spot Dollar Rate (Jisdor) exchange rate of Bank Indonesia (BI) closed lower by 0.6 percent to a price level of IDR 15,191 per US dollar.

Director of PT Profit Forexindo Berjangka Ibrahim Assuaibi said the Federal Reserve cut interest rates sharply last week and announced the start of the easing cycle.

"Felt requirements on the Fed will be released this week, with a series of officials, especially Jerome Powell, who will speak in the coming days. Fed-choice inflation measures, PCE price index data will also be released on Friday," he said in a statement, quoted Tuesday, September 24.

In addition, the US trade department is expected to propose banning China's software and hardware on connected and autonomous vehicles on American roads due to national security concerns.

Ibrahim said tensions in the central east continued. Israel continues to launch attacks on Gaza and Lebanon, so fears of a massive war in the region still exist.

"Hezbollah recently vowed to take revenge against Israel after the country allegedly blew up some of the electronic devices used by the Lebanese group," he said.

According to Ibrahim, fighting and the threat of war are constantly raising concerns that the greater conflict in the Middle East will disrupt supplies in the oil-rich region, thereby tightening the global market.

From the domestic side, Minister of Energy and Mineral Resources (ESDM) Bahlil Lahadalia said the subsidized fuel oil (BBM) tightening so that it is more targeted which is planned to be implemented on October 1, is not ready.

The government is currently still discussing the tightening regulations to be more targeted and reflect justice.

The formulation of the regulation issued must be distributed fairly to the level of farmers and fishermen.

The restrictions on the purchase of subsidized fuel oil (BBM) will only be carried out after the determination of the Ministerial Regulation (Permen).

Later regulations related to the purchase of subsidized fuel will be regulated in the Minister of Energy and Mineral Resources Regulation no longer Presidential Regulation (Perpres) Number 191 of 2014 concerning the Provision, Distribution and Retail Selling Price of fuel which is currently in the process of being revised.

Until now, the government has not been able to provide detailed information regarding the contents of the regulations regarding the restrictions on fuel, because until now it is still under study.

Meanwhile, the new regulations regarding subsidized fuel oil (BBM) are expected to be completed on September 1, 2024.

The regulation was originally scheduled to be implemented on August 17, 2024. However, it was forced to resign because it was still in the finalization process.

This new rule does not limit the purchase of subsidized fuel. This is one of the government's efforts to ensure that subsidized fuel is accepted by those who need it or are on target.

Ibrahim estimates that the rupiah will fluctuate but close lower in trading on Tuesday, September 24, 2024, in the price range of IDR 15,200 - IDR 15,280 per US dollar.