Anxiety Against US Interest Rate Increases Rupiah Rate

INDUSTRY.co.id - Jakarta - The rupiah closed 0.16% lower or Rp22 to Rp13,574 dollars in trading on Tuesday (12/12/2017) compared to the position at the close of trading yesterday at the level of Rp13.552 per US dollar.

In the opening session of trading this morning, the rupiah strengthened Rp1 to Rp13.551 per US dollar. The weakening of rupiah exchange rate is also experienced by the majority of Asian currencies. During the day, the Rupiah traded at Rp13.546-13.581 per US dollar.

According to Bloomberg data, the Philippine peso exchange rate experienced the highest decline, at 0.22%. Then, it was followed by Rupiah exchange rate and the Indian Rupee exchange rate weakening by 0.14%.

At 16:44 GMT, the US dollar index weakened 0.09% or 0.081 points to 93.785. The index measures the strength of the US dollar exchange rate against a number of major world currencies.

Ahead of a two-day meeting by the Federal Reserve, the US central bank, the US dollar exchange rate tends to flatten. The reason, since late 2015, the Federal Reserve is expected to raise interest rates the fifth time.

Meanwhile, investors are likely to monitor the Federal Reserve's assessment of US economic conditions as the US central bank's move is predicted to alter the market's view of future US interest rate moves.

In fact, Steven Dooley, a money market analyst at Western Union Business Solutions in Melbourne, said the rise in US interest rates this week has been predicted by the previous market.

"If the Federal Reserve really raises the US interest rate, then the US dollar rate is expected to weaken after the announcement of the rate hike," added Steven. (Abraham Sihombing)