Thursday Afternoon Rupiah Almost Touched IDR 16,000 Per US Dollar, A Record Since 1998

Illustration. (Photo: Bank Indonesia)

JAKARTA - The rupiah exchange rate today, Thursday, March 19, has weakened so rapidly, and it has even almost touched the level of Rp. 16,000 per US dollar. Even though it has been in a weakening trend in recent days, the rupiah today weakened 4.53 percent against the US dollar. The worst weakness in the Asian region today.

On a year to date basis, or since early January 2020, the depreciation of the rupiah to a level of Rp. 15,912 per US dollar has weakened by 14.76 percent. The launch fell relatively quickly, especially since the COVID-19 outbreak, which eroded the confidence of market players to save risky assets such as rupiah.

Today's weakness was even the worst in at least since the 1998 monetary crisis. At that time, the rupiah broke through to Rp. 16,650-16,800 per US dollar.

Although not as bad as the rupiah, today the currencies in the Asian region have largely weakened against the US dollar. Below the rupiah, there was the Korean won which weakened 3.22 percent, followed by the Indian rupee, which weakened 1.17 percent.

Then the Japanese yen weakened 0.94 percent, the Malaysian ringgit weakened 0.91 percent, the Chinese yuan weakened 0.75 percent, the Taiwan dollar weakened 0.59 percent, and the Singapore dollar weakened 0.30 percent.

Head of Research at Monex Investindo Futures, Ariston Tjendra, the depreciation of the rupiah is in line with global financial markets, where risk assets are still under pressure due to fears of an economic slowdown due to the pandemic of the corona virus outbreak or COVID-19.

"As long as the spread continues to increase, the lockdown continues, economic activity will be disrupted and slowed down. So that the market still does not see the current stimulus that can help restore things quickly," Ariston told VOI.

The Governor of Bank Indonesia, Perry Warjiyo, said that the adjustment of foreign capital inflows in the domestic financial market after the spread of COVID-19 had suppressed the rupiah exchange rate since mid-February 2020.

"Reduced foreign capital inflows due to increased uncertainty in global financial markets have put pressure on the rupiah exchange rate. Until March 18, 2020, the Rupiah weakened 5.18 percent on average compared to the February 2020 level, and daily point to point was weakened by 5 percent. , 72 percent, "said Perry during a live streaming of the Bank Indonesia press conference.

Bank Indonesia, said Perry, will continue to strengthen the rupiah exchange rate stabilization policy in accordance with its fundamentals and the operation of the market mechanism. To that end, Bank Indonesia continues to increase the intensity of stabilization in the Domestic Non-Deliverable Forward (DNDF) market, spot market, and purchases of government securities (SBN) from the secondary market.

"To support the effectiveness of exchange rate policy, Bank Indonesia continues to optimize monetary operations to ensure the operation of market mechanisms and the availability of liquidity in both the money and foreign exchange markets," said Perry.