Bank Mandiris money market analyst Rully Arya Wisnubroto said the rupiah continued to appreciate against the US dollar amid hopes of Indonesias economic fundamentals improving in the next three to six months.
"The impact of the first and second packages of economic policies, issued recently by the government, is expected to be felt in the next three to six months and will balance the sentiment in case the US central bank raises its interest rate," he said.
He said the governments plan to come up with the third package of economic policies on Wednesday evening has added to the positive sentiment regarding the national economys future projection.
Besides domestic factors, Rully Arya Wisnubroto said the predictions that the US Fed would not increase its interest rate this year due to weak economic employment data, have prompted investors to accumulate risky currencies, including the Rupiah.
"The employment data, still below expectations, has reduced the chances of the Fed increasing its rate this year while only two Federal Open Market Committee meetings are left. These are slated to be held in October and December," he said.
The head of research of Monex Investindo Futures, Ariston Tjendra, said the rupiahs exchange rate was showing an upward trend as the currency has been appreciating following the return of foreign investors to accumulate shares in Indonesia as the market sentiment towards Indonesia has been improving in the wake of governments readiness to release its third economic policy package.
"This momentum will continue for the next few weeks. The positive rupiah has made shares and bonds in Indonesia look more attractive to investors," he said.
The middle rate of the Rupiah at Bank Indonesia on Wednesday was recorded as having appreciated to Rp14,065 from Rp14,382 against the US dollar.(*)
Editor: Heru Purwanto
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