Rupiah weakens against dollar as exports, imports drop

Rupiah weakens against dollar as exports, imports drop

Illustration: The Indonesian rupiah dropped 50 points, or 0.34 percent, to touch Rp14,845 per dollar on Tuesday in the Jakarta interbank market. (ANTARA FOTO)

Although Indonesia's balance of trade is not minus, a sharp decline in exports and imports has caused the danger alarm to sound again. It is possible the economy will contract again in the third quarter of 2020, denting the hope of (the country) bein
Jakarta (ANTARA) - The Indonesian rupiah fell against the US dollar in the interbank Jakarta market on Tuesday evening on the back of a slide in the country's exports and imports.

The rupiah dropped 50 points, or 0.34 percent, to touch Rp14,845 per dollar compared to the previous close of Rp14,795 per dollar.

“Although Indonesia's balance of trade is not minus, a sharp decline in exports and imports has caused the danger alarm to sound again. It is possible the economy will contract again in the third quarter of 2020, denting the hope of (the country) being free from a recession,” PT TRFX Garuda Berjangka director, Ibrahim Assuaibi, said here on Tuesday.

Earlier in the day, Bank Indonesia had announced that the country's balance of trade recorded a surplus of US$9.2 billion in the second quarter of 2020 after registering a deficit of US$8.5 billion in the previous quarter.

In the meantime, the Central Statistics Agency (BPS) reported that Indonesia's imports in July, 2020 stood at US$10.47 billion, a 32.55-percent drop compared to the same period last year. Exports also declined 9.9 percent to US$13.73 billion in July, causing the balance of trade to record a surplus of US$3.26 billion.

On the external side, the market felt relieved following the agreement between the US and China to put the review of their trade agreement on hold this week. The agreement shored up confidence that trade relations between the two nations would continue despite conflicts in various other fields.

The rupiah strengthened to Rp14,763 per dollar on Tuesday morning. Throughout the day, the rupiah hovered within the range of Rp14,750 to Rp14,875 per dollar.

According to the Bank Indonesia mid-rate on Tuesday, the rupiah strengthened to Rp14,907 per dollar compared to Rp14,917 earlier.

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