Rupiah Movement Is Expected To Weaken Due To External Sentiment

Illustration (Photo: Doc. Antara)

JAKARTA - The rupiah exchange rate on Monday, November 27, 2023 is expected to weaken again due to global economic conditions that have also affected Indonesia's economic conditions.

Quoting Bloomberg, the Rupiah exchange rate on Friday, November 24, the rupiah spot exchange rate slightly weakened 0.07 percent to Rp15,565 per US dollar.

Meanwhile, Jisdor's rupiah exchange rate slightly strengthened 0.03 percent daily to a price level of IDR 15,587 per US dollar.

Director of PT Profit Forexindo Berjangka Ibrahim Assuaibi said the market continues to monitor several things that will affect Indonesia's economic growth in the future, possibly not in accordance with government and Bank Indonesia's expectations.

This will affect Gross Domestic Product in the fourth quarter of 2023 below 5 percent.

"First, there is a global economic condition that will definitely affect Indonesia's economic condition. Second, geopolitical tension where conflicts that occur such as Israel and Palestine and Russia with Ukraine, will also have an effect. This will have an impact on inflation and the rupiah exchange rate," he explained in his official statement Monday, November 27.

According to Ibrahim, this challenge can be overcome with the state budget or APBN which has a role as an instrument that maintains economic stability.

In addition, the state budget also has the aim of improving the welfare of the community. Thus, the management of the state budget will continue to pay attention to the dynamics of the economy, which has a different impact on domestic.

Previously, the Central Statistics Agency (BPS) announced Indonesia's economic growth in the third quarter of 2023 of 4.94 percent year on year (YoY) and grew 1.6 percent quarterly to quarteral (QtQ).

Ibrahim said that, cumulatively, Indonesia's economic growth was recorded at 5.05 percent.

Economic growth in the third quarter of 2022 reached 5.73 percent.

In addition, market participants have been waiting for US manufacturing data last Friday.

The data is already expected to show a sustainable weakening in business activities as the US economy weakens due to high interest rates and high inflation rates.

"Any signs of weakening in the US economy provide limited space for the Fed to maintain higher interest rates, and also increase the chance of lower interest rates early," he explained.

Ibrahim estimates that the rupiah will fluctuate but closed lower in trading Monday, November 27 in the price range of IDR 15,540- IDR 15,620 per US dollar.