AntaraJakarta (ANTARA) - The rupiah exchange rate traded during interbank transactions in Jakarta, Thursday morning, strengthened in line with the policies of the US Central Bank, the Federal Reserve (Fed), to keep its interest rates steady.
The rupiah exchange rate strengthened 94 points to Rp14,094 per US dollar, as compared to the earlier position of Rp14,188 per US dollar
Samuel Asset Management economist Lana Soelistianingsih stated in Jakarta on Thursday that apart from deciding to maintain the Fed Fund Rate in the range of 2.25-2.5 percent, the Fed also lowered the US economic growth forecast to 2.1 percent, from the earlier estimate of 2.3 percent and to 1.9 percent, from two percent for 2020.
"This projection is also a reference for the Fed, which is likely to maintain interest rates during 2019 at the current level, with a potential to decline in 2020 and 2021," Soelistianingsih stated.
The Fed also raised its forecast for the unemployment rate for 2019, from 3.5 percent to 3.7 percent, and for 2020, from 3.6 percent to 3.8 percent, and for 2021, from 3.8 percent to 3.9 percent.
"The slowing projection of the Fed's economic growth and the rising unemployment rate are indicative of a slowdown in the US economy, although it cannot be said as a recession, which by definition shows that economic growth has also declined negatively in the depression phase, deep recession," Soelistianingsih noted.
Lana estimates that the rupiah will currently move lower to lie in the range of Rp14,150 to Rp.14,180 per US dollar.
Meanwhile, the central exchange rate of Bank Indonesia (BI) on Wednesday showed that the rupiah strengthened to Rp14,102 per US dollar as compared to Rp14,231 per US dollar on the previous day.
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Translator: Eliswan Azly
Editor: Fardah Assegaf
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