FXTM Research Analyst Lukman Otunuga here Monday stated that the economic turmoil in Turkey and Argentina had weighed on the currencies of developing countries, including the rupiah.
"Even though Bank Indonesia (BI) intervened in an effort to maintain the rupiah, strong external negative sentiment hindered BI`s efforts to protect the domestic currency," he said.
There were still trade tensions between the United States and China, and speculation that US interest rates were increasing which eroded appetite for currencies in developing countries.
"In the midst of the situation, it can make the rupiah depreciate further," he noted.
He added that a number of money market players are now waiting for BI`s policy in the future, whether to raise interest rates again this year or other policies.
"That is one of the questions of a number of market participants," he remarked.
Meanwhile, BI`s middle rate today (Sept 3), recorded the rupiah weakening to Rp14,767 compared to the previous (Aug 31) at Rp14,711 per US dollar.
Reported by Zubi Mahrofi
Edited by Eliswan, Rahmad Nasution