Rupiah Potentially Weakens Due to Domestic Sentiment

US and Rupiah dollars (Photo: dock. Antara)

JAKARTA - The rupiah exchange rate on Tuesday, October 22, 2024, is expected to weaken against the United States (US) dollar.

Quoting Bloomberg, the rupiah exchange rate on Monday, October 21, 2024, the rupiah exchange rate on the spot market closed down 0.15 percent at IDR 15,504 per US dollar. Meanwhile, the rupiah exchange rate at Bank Indonesia's (BI) Jakarta Interbank Spot Dollar Rate (Jisdor) closed slightly higher by 0.006 percent to IDR 15,465 per US dollar.

Director of PT Laba Forexindo Berjangka Ibrahim Assuaibi said that the composition of the Prabowo-Gibran cabinet had been announced. The old names are still scattered, especially in the economic team.

"Some say that the composition of the Red and White Cabinet still smells of Jokowi. There are representatives of parties, professionals, and supporters or the Prabowo-Gibran winning cheer team. Also, there are many names that previously sat in the Jokowi-Ma'ruf Cabinet," he explained in his statement, quoted on Tuesday, October 22.

However, Ibrahim conveyed that the number of cabinet members announced by President Prabowo Subianto is definitely fat, or chubby and tends to be obese.

According to Ibrahim, the names of the cabinet members that have been announced are an act of reciprocation, which has so far gone all out to defend Prabowo-Gibran during the previous presidential election. This act of reciprocation is what made the market respond negatively.

In fact, the number of the Red and White Cabinet is the largest in Asia Pacific, and could even be the largest in the world with the number of ministers and deputy ministers reaching 105. While the average number of ministers in Asia Pacific countries is only 22 ministers.

However, outside the cabinet that has been announced by President Prabowo, there are still several supporting political parties (NASDEM Party, PKS and PDIP) that have not received ministerial positions.

Ibrahim said the market estimates that many ministers or deputy ministers will likely not last long/resupply for up to 5 years, because there are still many candidates for ministers and deputy ministers queuing from supporting political parties.

Ibrahim estimates that the rupiah will fluctuate but close lower in trading on Tuesday, October 22, 2024 in the price range of IDR 15,490 - IDR 15,580 per US dollar.