BI's board meeting drives rupiah to plunge

Jakarta (ANTARA) - Indonesia's rupiah opened lower by 21 points, or 0.15 percent, to Rp13,715 against the US dollar on Wednesday morning in the Jakarta interbank market, as Bank Indonesia (BI) began its board meeting today.

According to an analyst, on the external front, fears over the coronavirus or COVID-19 outbreak still contributed to the drop. In the meantime, on the domestic front, decreasing figures in exports and imports may also push Indonesia's rupiah to decrease, Samuel Aset Manajemen's head of research, Lana Soelistianingsih, stated in Jakarta.

"The trade balance in January 2020 recorded a significant drop in Indonesia's imports and exports. The decreasing figure of imports indicates a drop in domestic demand," Soelistianingsih expounded.

The coronavirus outbreak has hit not only tourism but also the banking sector. "I believe there might be a multiplier effect on the sectors of trade and the micro, small, and middle enterprises in Indonesia (owing to the outbreak)," she stated.

On the external front, Moody's revised China's economic growth, from 5.8 percent to 5.2 percent, this year.

"The coronavirus outbreak has affected regional markets. Trade and tourism are two sectors that will be severely hit. The global supply chain will also be disrupted due to the outbreak," Soelistianingsih remarked.

Throughout the day, she suggested that the rupiah will move within the range of Rp13,700 to Rp13,720 against the dollar.

In the meantime, BI's mid-rate currently showed the rupiah had plunged to Rp13,717 against the dollar, while a day earlier, it was recorded at Rp13,676.

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