According to the Bloomberg Dollar Index, the Indonesian rupiah continued to depreciate on Monday (20/07). Indonesia’s currency weakened 0.31 percent to IDR 13,395 per US dollar, its weakest level since 1998 when the country was plagued by the Asian Financial Crisis. Meanwhile, Bank Indonesia’s activities are still limited until Wednesday (22/07) due to a public holiday (Idul Fitri celebrations), implying that the central bank temporarily doesn't publish its Jakarta Interbank Spot Dollar Rate (abbreviated: JISDOR).

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As expected Indonesia's central bank (Bank Indonesia) refrained from adjusting its interest rate regime at Tuesday’s Board of Governor’s meeting (14/07). The key BI rate was kept at 7.50 percent, while the overnight deposit rate (Fasbi) and lending facility rate were left at 5.50 percent and 8.00 percent, respectively. Bank Indonesia believes that the current interest rate environment is in line with its efforts to bring down inflation while supporting Indonesia’s ailing rupiah ahead of expected further monetary tightening in the USA later this year.

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In line with the global trend, Indonesian stocks extended their gains on Tuesday morning (14/07). Most stock indices (across the globe) continue to move in green territory after debt-ridden Greece and its international creditors agreed - after a 17-hour long emergency meeting - to an austerity package that will keep Greece within the Eurozone. Indonesia’s benchmark Jakarta Composite Index (IHSG) had risen 0.60 percent to 4,923.36 points by 11:45 am local Jakarta time on Tuesday.

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Most analysts agree that the central bank of Indonesia (Bank Indonesia) will leave its interest rate regime unchanged at the Board of Governors’ Meeting that is scheduled for Tuesday 14 July 2015. Indonesia’s central bank is expected to maintain its key interest rate (BI rate) at 7.50 percent, the overnight deposit facility rate (Fasbi) at 5.50 percent, and the lending facility rate at 8.00 percent as the country’s inflation rate has recently accelerated while the rupiah has been under pressure due to external factors.

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The International Monetary Fund (IMF) cut its forecast for global economic growth in 2015 to 3.3 percent (y/y), from 3.5 percent (y/y) previously, as the harsh winter impacted on the US economy and drags down global growth accordingly. In the first quarter of 2015, the US economy contracted 0.2 percent (y/y). Moreover, turmoil in Greece and China cause great volatility on international financial markets, the Washington-based institution said in an update to its World Economic Outlook (WEO) on Thursday (09/07).

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Indonesia’s foreign exchange reserves fell USD $2.8 billion to USD $108.0 billion at the end of June 2015 (from USD $110.8 billion one month earlier). This fall was caused by foreign debt repayment and the use of foreign exchange to stabilize the rupiah exchange rate. Due to external pressures (particularly looming further monetary tightening in the USA this year and the possible Greek exit from the euro), the rupiah is the worst performing Asian currency tracked by Bloomberg so far in 2015, weakening about 7 percent against the US dollar.

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The Indonesian government revised its 2015 economic growth target. Sofyan Djalil, Indonesian Coordinating Minister for Economic Affairs, stated on Friday (03/07) that the government’s previous target was unrealistically high at 5.8 percent (y/y) given the sluggish international and domestic economic context. The government revised down the GDP growth target of 2015 to 5.2 percent (y/y). Djalil said that the global economy is forecast to grow 2.9 percent (y/y) in 2015 from an earlier estimate of 3.5 percent (y/y).

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Eric Sugandi, Chief Economist at the Standard Chartered Bank, expects Indonesia’s rupiah to have depreciated to IDR 13,900 per US dollar by the end of the year from IDR 13,339 currently (29/06) due to the impact of the bullish US dollar ahead of monetary tightening in the USA and the looming Greek exit from the Eurozone. Actually, this is a conservative prognosis. In case Indonesia’s central bank does not raise its benchmark interest rate (BI rate), currently at 7.50 percent, pressures on the rupiah may increase in fact increase further.

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In line with markets' expectation the central bank of Indonesia (Bank Indonesia) kept its benchmark reference interest rate (BI rate) unchanged at 7.50 percent on Thursday (18/06). Bank Indonesia remains committed to its relatively tight monetary stance in a bid to combat accelerated inflation, limit the country's wide current account deficit, and support the ailing rupiah. The central bank also kept its overnight deposit facility rate (Fasbi) and lending facility rate at 5.50 percent and 8.00 percent, respectively.

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Indonesian stocks rebounded on Tuesday (16/06). The country’s benchmark Jakarta Composite Index rose 0.72 percent to 4,872.60 points supported by foreign net buying and rebounding from yesterday’s 13-month low position. Middle and longer term investors now have great opportunity to find stocks at bargain prices (particularly those stocks that are not too exposed to the weakening rupiah). However, trading volume was low at about 60 percent of the past 30-day average thus indicating that market participants remain wary.

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The global environment has not improved in August 2019. In fact, it has deteriorated as reflected by declining stock indices in most parts of the world as well as a record-setting trend for the price of gold (known for being one of the world’s crucial safe haven assets).

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As stock markets continue to trade near precarious highs and an underlying current of geopolitical uncertainty continues to limit the outlook for equities in 2019, it is not entirely surprising to see going prices rallying. Indeed, this has been our price forecast for several weeks. But the confirmation of these forecasts came as the result of new evidence indicating weakness in US labor markets and rising expectations that the Federal Reserve will be forced to reduce interest rates more than previously anticipated. 

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The Indonesian rupiah rate weakened against the US dollar in March 2019. Bank Indonesia’s benchmark JISDOR rate finished the third month of the year at a position of IDR 14,244 per US dollar, down 1.29 percent compared to the level of IDR 14,062 per US dollar that was set at the last trading day of February 2019. Nevertheless, compared to the start of the year, the rupiah has remained in positive territory, having appreciated 1.64 percent against the US greenback in the first quarter of 2019.

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At the annual “Fitch Ratings Indonesia Credit Briefing”, which was organized on 20 March 2019 in the Mandarin Oriental Hotel in Jakarta, Indonesian Finance Minister Sri Mulyani Indrawati was invited to present her keynote speech. This year's theme of Fitch Ratings’ annual event in Jakarta was "The Election, Macro-Economy and Credit Market", and therefore Sri Mulyani’s speech focused on two topics: (1) the elections and (2) the economy.

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In line with expectations, the central bank of Indonesia (Bank Indonesia) kept its benchmark BI 7-Day Reverse Repo Rate at 6.00 percent at the February policy meeting that was held on 20-21 February 2019. Also the deposit facility and lending facility rates were kept at 5.25 percent and 6.75 percent, respectively.

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The Indonesian rupiah appreciated markedly in January 2019, and reached its strongest level since the end of June last year. The benchmark JISDOR rate of Bank Indonesia ended the first month of 2019 at IDR 14,072 per US dollar, strengthening from the level of IDR 14,481 per US dollar at the last trading day of 2018. Or, in other words, the rupiah managed to appreciate 2.82 percent against the greenback in the first month of 2019.

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Indonesia's benchmark Jakarta Composite Index fell 1.24 percent to 6,229.63 points on Tuesday (24/04). The performance of Indonesian stocks were in line with the general trend in Southeast Asia. Due to rising US treasury yields (touching nearly 3 percent, its highest level since January 2014) investors withdraw their funds from riskier assets in emerging markets. Concerns over US inflation and the fiscal deficit are behind the rising US treasury yield.

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On Monday (06/11) Indonesia's Statistics Agency (BPS) is scheduled to release Indonesia's third quarter GDP data, important information that is closely followed by investors and analysts. While most analysts expect to see accelerated economic growth in the third quarter, others remain skeptical as Indonesia's gross domestic product was disappointing in the first two quarters of the year amid bleak domestic consumption.

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After touching a new all-time record high level last week, analysts are optimistic that Indonesia's benchmark Jakarta Composite Index will surpass the psychological level of 6,000.00 points later this year. Last Friday (25/08) the benchmark index of Indonesia reached 5,915.36 points, a new record, while market capitalization touched IDR 6,481.8 trillion (approx. USD $483.9 billion).

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The central bank of Indonesia (Bank Indonesia) decided to leave its monetary policy unchanged at the two-day policy meeting in June 2017 that was concluded on Thursday (15/06). As widely expected it kept the benchmark 7-day reverse repurchase rate at 4.75 percent, as well as the deposit facility and lending facility at 4.00 percent and 5.50 percent, respectively. These existing levels are regarded to keep financial markets and the economy stable.

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