Rupiah traded at 9,645 to the US dollar, strengthening from its initial level of 9,665.
"The Indonesian currency became strong because of positive sentiments from Europe," said Reza Priyambada, an analyst at Trust Securities, on Friday.
Apart from Europe, China also has positive sentiments. So, China's positive sentiments could have been compensated by negative sentiments from the US.
"China's economic data shows positive figures. China's positive sentiments could have been compensated by negative sentiments from the US, where Moody's Corporation will reduce the US credit rating," he said.
According to him, investors are worried because the US government has not agreed to increase the limit of the US debt. This will affect government bond issuance plans in the future.
"Apart from that, Indonesia`s negative trade balance can prevent the Indonesian currency from becoming stronger," he said.
Ariston Tjendra, head of Research Futures Investindo, added that US policy makers are worried that it will be difficult to increase the limit of the US debt, even though the country had been successful in avoiding the fiscal cliff.
"This could reduce the demand for risky assets," he said.
(S038/KR-BSR/O001)
Editor: Jafar M Sidik
Copyright © ANTARA 2013
