Rupiah weakens following anxiety over global economic slowdown

Rupiah weakens following anxiety over global economic slowdown

Officers of foreign exchange services check rupiah banknotes and US dollars in Jakarta (ANTARA /Puspa Perwitasari)

Jakarta, (ANTARA News) - The rupiah exchange rate, traded among banks in Jakarta on Monday morning, weakened by 11 points to Rp14,618, from earlier Rp14,607 per US dollar.

"The US dollar strengthened against almost all global currencies, including the rupiah," Samuel Sekuritas economist Ahmad Mikail stated here on Monday.

According to Mikail, the US dollar returned to being a safe-haven asset, as market concerns intensified over the outlook for the global economy next year after the released US-China economic data showed some slowdown.

He said, China`s Industrial Production Index had only grown 5.4 percent in November, the lowest since 2003. Data from the US regarding retail sales indicated a slowdown of 4.2 percent year-on-year in November.

He added that ahead of the release of Indonesia`s trade balance data, the rupiah is expected to still be burdened by sentiment from the November trade balance data deficit.

"It is projected that the rupiah will move in the range of Rp14,590 of Rp14,650 per US dollar," he stated.

Head of Monex Investindo Futures Research Ariston Tjendra remarked that the slowing global economic growth had reduced demand for currency assets in Asian countries.

"The weakening of the global economy has made market players tend to avoid risk assets and move towards safer assets, such as the US dollar," he pointed out.

Reporting by Zubi Mahrofi, Elsiwan
Editing by Fardah