Jakarta (ANTARA News) - The Indonesian currency rupiah lost some of its value against the US dollar closing at the level of 12,492 per US dollar on Wednesday from earlier level of 12,470.

"The currency weakened against the US dollar amid anticipation of the result of a meeting of the US Central Bank this week," financial market observer from Bank Himpunan Saudara Rully Nova said.

Rully said if the Fed would give a signal to postpone the plan to raise its benchmark interest rate rupiah could regain strength.

The negative sentiment from the country is triggered by market expectation that there were no significant improvement in inflation and foreign trade balance.

"Inflation is expe3cted again in January 2015 though slightly and trade in December 2014 remained in the red. The condition weighed on rupiah," he said.

However, the European Central Bank policy could still offset the negative sentiment from the United States and domestic sentiment.

ECB plans to issue a financial stimulus that would help prop up the euroe and risky currencies including rupiah.

"ECB which will launch quantitative easing could improve global liquidity . Developing economies including Indonesia which still has potential to grow would gain from the policy," he said.

Analyst from PT Platon Niaga Berjangka, Lukman Leong said the ECB policy would encourage market players to buy risky assets including rupiah.
(Uu.H-ASG/A014)

Editor: Priyambodo RH
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