The US-China Is Heating More And Making The Rupiah Continue To Strengthen

JAKARTA - The rupiah exchange rate on the spot market is able to maintain its strengthening trend. The rupiah opened on Friday, July 24, strengthening 55 points to a level of Rp14,520 per United States dollar (US).

Monex Investindo Futures Head of Research, Ariston Tjendra, said that this morning the US dollar was still showing weakness against emerging market currencies and also against major world currencies.

"The weakening is likely due to market concerns over the condition of the transmission of the COVID-19 virus which is still increasing and has the potential to worsen in the US which could reduce the pace of economic recovery in Uncle Sam's country," Ariston told VOI.

The heating up of US relations with China due to the issue of the closure of the Chinese consulate office in Houston, USA, has also put pressure on the US dollar in the meantime.

"The US economy can suffer losses if the conflict spreads to economic problems with China," explained Ariston.

According to him, the rupiah could continue to strengthen because of the above with a potential range of IDR 14,500-14,650 per US dollar.

"But on the other hand, the market could immediately switch views if the above issues were considered to be disruptive to the global economic recovery which could cause risky asset prices to be depressed down, including the rupiah," explained Ariston.

This morning, the majority of currencies in the Asia Pacific region strengthened against the US dollar, led by the rupiah. Followed by the Japanese yen and Singapore dollar, which each strengthened 0.30 percent and 0.13 percent.

Then the Thai baht and the Philippine peso both gained 0.07 percent. Malaysian ringgit looks slightly lifted 0.02 percent.

Meanwhile, the weaker currency was led by the South Korean won which depreciated 0.21 percent. Followed by the Chinese yuan and the Hong Kong dollar, which fell 0.03 percent and 0.01 percent, respectively.