DBS Bank Economist Radhika Rao, in a statement to Antara received via e-mail in Jakarta, Tuesday, stressed on greater vigilance and compliance by the Indonesian public to reduce the rate of transmission of COVID-19 in the midst of the PSBB relaxation.
Rao deemed this necessary in the wake of a continued rise in the number of COVID-19 cases in Indonesia. In the meantime, the Indonesian government attributed the surge in the number of confirmed cases to the significant increase in the capacity of sample testing.
"Several factors would need to be closely observed. Among the ASEAN-6 block, Indonesia is included in the group of countries where the total number of confirmed cases continues to rise, contrary to that of other countries, such as Vietnam or Thailand, where the number of cases has generally become stable," he pointed out.
The Indonesian government has stepped up the capacity of specimen testing in order to yield more accurate results pertaining to the transmission rate of COVID-19. President Joko Widodo has called to augment testing capacity to reach 20 thousand samples per day.
In the financial market, Rao assessed that the Indonesian rupiah and bond assets are improving and recovering in the second quarter of 2020 after reeling under pressure owing to investor selling in the first quarter of 2020 following global sentiment.
"The rupiah erased most of its losses in early June 2020 and emerged as a superior currency in the region. However, the rupiah’s strengthening will make it vulnerable to shares purchases that have reached the support zone in the short term," he explained.
Rao projects likely turmoil in the bond market. However, Bank Indonesia's statement to stabilize the primary and secondary markets for Government Securities (SBN) could avert a sharp plunge in SBN prices.
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Translator: Indra Arief Pribadi/Aria Cindy
Editor: Rahmad Nasution
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