Rupiah Predicted Fluctuating Tend To Weaken To Rp16,320 Per US Dollar

JAKARTA - The rupiah exchange rate in trading Wednesday, January 15, 2025 is expected to weaken against the United States (US) dollar.

JAKARTA - The rupiah exchange rate is predicted to fluctuate but closed lower in trading on Wednesday, January 15, 2025. The movement is in the price range of IDR 16,260 - IDR 16,320 per US dollar.

Director of PT Profit Forexindo Berjangka Ibrahim Assuaibi told traders to speculate about how severe the trade tariff planned by President-elect Donald Trump and also waiting for more signal about US interest rates from the main inflation data to be released this week.

"In addition, the Trump team is preparing plans for the implementation of trade rates in stages in the coming months, Bloomberg reported on Monday, although it is unclear whether the President-elect will follow up on the plan," he said in a statement, quoted Wednesday, January 15.

Ibrahim said the plan would involve a tariff increase of between 2 percent and 5 percent every month, and would give Washington more influence in trade negotiations, as well as prevent a sudden spike in inflation due to import duties.

However, this is largely offset by concerns that tariffs will also be a higher inflation factor, so interest rates remain longer. Trump has promised to impose a high import rate since the first day he served as president, with a 60 percent import duty pledge against China being the main concern.

"This week's focus is on data on inflation of the consumer price index for December, which will be released on Wednesday, which is expected to provide more clues about interest rates," he explained.

Ibrahim said that high inflation and strength in the labor market are expected to provide the Federal Reserve with more space to keep interest rates high, a trend that is a bad sign for assets that do not provide yields such as gold and other metals.

Meanwhile, from within the country, the Government believes that Indonesia's economic growth can grow 5.1 percent in 2024, because it is able to maintain economic growth at a solid level of 4.95 percent (year on year) in the third quarter of 2024 which reflects economic resilience and competitiveness.

In addition, the real sector indicators also show positive figures, including the Manufacturing PMI which remains expansionary at the level of 51.2, with strong domestic demand, and the Consumer Confidence Index (IKK) also continues to be optimistic, namely that in December 2024 it will be 127.7, and the Real Sales Index (IPR) will also grow positively.

In addition, Indonesia's economic growth in 2024 was also boosted by several policies and economic activities that were more active at the end of the year, namely ahead of Christmas and New Year, such as the free homecoming program, discounted plane ticket prices.

In keeping the momentum of economic growth good, the Government has also issued various Economic Stimulus Packages which were released at the end of 2024, such as food/rice assistance, 50 percent electricity discount for 2 months, property and automotive DTP VAT, and Article 21 DTP PPh incentives for labor-intensive sectors.

One of Indonesia's capital is the potential of a large middle class, as the main driver of economic growth. The number of Indonesian middle class is very significant, with a proportion of 66.35 percent of the total population.

So, the Government consistently provides support for the middle class through various programs such as subsidies, tax incentives, support for access to business financing, and increasing human resource capacity.

As is known, citing Bloomberg, on Tuesday, January 14, 2025, the rupiah spot exchange was closed higher by 0.08 percent to the level of Rp. 16,270 per US dollar. Meanwhile, the Jakarta Interbank Spot Dollar Rate (Jisdor) exchange rate of Bank Indonesia (BI) closed up 0.10 percent to a price level of Rp. 16,265 per US dollar.