"The positive domestic sentiment in response to the governments plan to issue the 12th tranche of economic policy package has pushed up the local currency amidst worries over declining oil prices," Rully Nova of Bank Himpunan Saudara said.
The rupiah traded at Rp13,135 per dollar when it last closed at the Jakarta inter-bank spot market.
The government is set to launch the policy package shortly after President Joko Widodo (Jokowi) returns from his April 17 to 23 visit to Europe. The policy package is part of the governments efforts to deregulate economic policies.
Meanwhile, WTI Crude fell 2.31 percent to US$40.13 per barrel, and Brent Crude slid 1.84 percent to US$43.22 per barrel on Wednesday evening.
Rully explained that the meeting of Bank Indonesias board of governors also added to the positive sentiment.
Money market analyst Lukman Leong of PT Platon Niaga Berjangka said the global oil prices which stabilized at US$40 per dollar have helped the currencies which rely on commodity exports, including the rupiah.
In addition, the US home data below the market estimate and the Federal Reserves dovish stand on its plan to raise interest rate have added to the dollars weakening.
"This situation causes the US dollar to weaken in the Asian foreign currency market, including in Indonesia," he stated.(*)
Editor: Heru Purwanto
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