The rupiah jumped 95 points, or 0.64 percent, to touch Rp14,750 per US dollar, from Rp14,845 per US dollar earlier.
Chief of Research and Education of Monex Investindo Futures Ariston Tjendra stated that the US dollar appeared to be less attractive in the market, or came under pressure, in the past few days, as uncertainty loomed large over the extent to which the US economy would make progress in recovery in the midst of the rising number of COVID-19 cases in the country.
"Regional currencies appeared to strengthen against the dollar this morning. The rupiah should strengthen accordingly," he stated.
However, the projection of domestic recession and the higher-than-expected decline in the country's imports applied pressure on the rupiah, he pointed out.
"The data of slow imports signals weak activities of the domestic economy, including manufacturing and consumption. The Indonesian economic recovery remains in question," he affirmed.
The market also awaits the outcome of the meeting of Bank Indonesia's board of governors. If the meeting issued new stimulus to facilitate Indonesia’s economic recovery, it will support the rupiah's appreciation against the dollar, he stated.
"The two conflicting sentiments above will cast a pall over the movement of the rupiah today. The rupiah may open higher and close lower today," he remarked.
Tjendra has forecast the rupiah to hover in the range of Rp14,750 to Rp14,950 per dollar on Wednesday.
Bank Mandiri money market analyst Rully Arya Wisnubroto stated that pressure on the rupiah was quite high in the past few days.
Wisnubroto noted that at the meeting of BI's board of governors, the benchmark rate was expected to be kept unchanged at four percent.
"It seems that the demand for foreign exchange today had begun to decline, influenced by the weakening trend of the US dollar against other global currencies," he noted.
Wisnubroto forecast the rupiah to trade in the range of Rp14,765 and Rp14,835 per dollar on Wednesday.
"The rupiah will likely fluctuate. However, it will appreciate as compared to yesterday," Wisnubroto noted.
The rupiah plunged 50 points, or 0.34 percent, to Rp14,845 on Tuesday, as compared to Rp14,795 per dollar earlier.
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