The 2018 inflation rate that met the government-set target of 3.5 percent, with a deviation of 1 percent, was one of the reasons for the rupiah`s appreciation, money market observer Rully Nova of Bank Woori Saudara Indonesia stated.
"The controllable inflation will be able to maintain the stability of economic growth," he added.
The Central Statistics Agency (BPS) earlier in the day noted that the country`s inflation rate in December 2018 reached 0.62 percent, down from 0.71 percent in the same month a year earlier,
The December 2018 inflation brought the calendar inflation from January to December 2018 to 3.13 percent and the year-on-year inflation to 3.13 percent, the agency noted.
Nova added that the rupiah`s appreciation was also attributable to the negative sentiment towards the US dollar.
"The US dollar weakened against a number of global currencies as market agents took caution in responding to the Fed`s policy which tends to be dovish," he remarked.
Economist Ahmad Mikail of Samuel Sekuritas revealed that the partial US government shutdown has also boosted the public expectation that the US economy will slow down in 2019.
"That is one of the factors pushing market agents to put their money in Japanese yen as safe haven assets. The yen`s appreciation has a positive impact on the rupiah," he added.
Reporting by Zubi Mahrofi
Editing by Suharto
Reporter: Antara
Editor: Suharto
Copyright © ANTARA 2019
