Rupiah appreciates on falling US bond yields

Rupiah appreciates on falling US bond yields

Illustration - A teller shows Rp100,000 and Rp50,000 bank notes

However, on the other hand, yields on the US government bonds that fell again to below 1.6 percent held the rupiah's weakening and may boost the rupiah's strengthening against the US dollar.
Jakarta (ANTARA) - The Indonesian rupiah strengthened against the US dollar in the Jakarta interbank market on Tuesday morning along with declining US bond yields.

The rupiah rose 22 points, or 0.16 percent, to open at Rp13,690 per US dollar at 10:08 a.m. local time than the earlier close of Rp13,712 per US dollar.

Monex Investindo Futures Chief Researcher Ariston Tjendra stated in Jakarta on Tuesday that the fear of the coronavirus outbreak continued to cast a shadow on the money market, especially after a spike in the number of people infected with and dying of coronavirus.

"However, on the other hand, yields on the US government bonds that tumbled again to under 1.6 percent held the rupiah's weakening and may boost the currency’s strengthening against the US dollar," he stated.

In the meantime, the People's Bank of China (PBoC) reportedly injected another 100 billion yuan, or nearly US$14.3 billion, worth of funds into the market.

"This may offer a positive sentiment to the risk asset market, including the rupiah," he stated.

He has forecast the rupiah to trade in the range of Rp13,670 to Rp13,720 per US dollar on Tuesday.

According to the Bank Indonesia, the central bank mid-rate on Tuesday, the rupiah appreciated to Rp13,685 per US dollar on Tuesday in comparison with Rp13,708 per US dollar the day before.

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