This Weekend Rupiah Strengthens, What About Next Week? Here's Analysis Statement

TRIBUNBATAM.id - The exchange rate of rupiah against US dollar strengthened in trading this weekend Friday (18/10).

Strengthening of rupiah is expected to continue next week.

Quoting Bloomberg, Friday (18/10) at 16.55 WIB, rupiah strengthened 0.05% to level of IDR 14,147 per US dollar.

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Meanwhile, based on the middle rate of Bank Indonesia (BI) or JISDOR, rupiah strengthened 32 points from previous trade, to IDR 14,140 per US dollar.

Bank Mandiri economist Reny Eka Putri said the movement of rupiah exchange rate against US dollar this week tends to strengthen sideways.

This can be seen from the movement of rupiah in the last two days that closed higher.

"For now the position of US dollar tends tobearish, because US economic data such as retail sales, industrial production and inflation tend to fall or not as expected," Reny explained to Kontan.co.id, Friday (18/10).

US dollar was also pressured by euro and pound which gained due to rising market expectations that would be an agreement on Brexit.

Regarding sentiment from domestic market alone, Reny said there were not many data releases that had an effect on strengthening of rupiah.

Fortunately, inflow continued to enter and become driving force for the strengthening of rupiah this week.

Next week, the meeting of Federal Open Market Committee (FOMC) and Board of Governors' Meeting (RDG) of Bank Indonesia (BI) will determine direction of rupiah.

The two central bank meetings will determine respective interest rates and direction of monetary policy going forward.

"The market sees an opportunity for US Central Bank to cut benchmark interest rates once again, judging by economic growth, manufacturing performance and US inflation that is still down, so The Fed will cut interest rates," said Reny.

Reny guessed that next week rupiah still has a chance to strengthen with sideways tendencies.

Rupiah will move around the support level of IDR 14,100 per US dollar and resistance level at IDR 14,190 per US dollar.

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