"The ongoing dominant external sentiment caused the US dollar to appreciate, and the rupiah lost its timing to rise".Jakarta (ANTARA News) - The Indonesian rupiah weakened to Rp14,181 against the US dollar on Tuesday, according to the Jakarta Interbank Spot Dollar Rate, or depreciated 78 points from its previous level of Rp14,103 per US dollar.
Binaartha Securities` analyst Reza Priyambada stated here on Tuesday that external sentiment arising from the trade agreement inked between the United States and China had influenced higher demand for the US dollar in the global market, and this has led to the weakening of currencies of emerging countries, including the rupiah.
"The ongoing dominant external sentiment caused the US dollar to appreciate, and the rupiah lost its timing to rise," he noted.
Moreover, up to three percent of the US bond yields is still causing external pressure on the rupiah.
"The rupiah is estimated to hover in the range of around Rp14,169 to Rp14,189 per US dollar today," Priyambada added.
Thus, the Indonesian government`s optimism to achieve its 2019 tax ratio target of 11.4 to 11.9 percent is expected to prevent the rupiah from plunging steeply.
Meanwhile, positive data of the United States` manpower employment in the second quarter might signal the Federal Reserve to hike its rate again in June, and this will cause the rupiah to weaken, according to Samuel Securities` economist Ahmad Mikail.
"That sentiment is forecast to weaken the rupiah, which will have a minimum positive catalyst," he noted.