USD/IDR off multi-day highs post-mixed Indonesia's CPI
|Indonesia’s annual inflation rate softened slightly in March, according to the latest data published by Statistics Indonesia on Wednesday.
Indonesian March’s inflation rate dropped to 2.96% on the year, compared with February’s 2.98% and 2.96% expectations but remained between the Bank Indonesia’s (BI) 2.5-4.5% target range. The annualized core figure arrived at 2.87% vs. 2.76% previous and 2.79% expected.
Meanwhile, the monthly inflation reading for March came in at +0.10% vs. +0.14% expected and +0.28% last.
About Indonesia’s CPI
The Inflation index released by the Statistics Indonesia is a measure of price movements by the comparison between the retail prices of a representative shopping basket of goods and services. The purchase power of the Indonesian Rupiah is dragged down by inflation. The CPI is used as a key indicator to measure inflation and changes in purchasing trends. Generally speaking, a high reading is seen as positive (or bullish) for the Rupiah, while a low reading is seen as negative (or Bearish).
USD/IDR reaction
The USD/IDR cross is off the six-day highs of 16,652 and trades near 16,570 region on the mixed Indonesian CPI data release. The Indonesian Rupiah remains undermined by the coronavirus outbreak-led 2020 GDP growth forecast downgrade by the financial authorities.
The rupiah failed to take advantage of the upbeat comments by the central bank Governor Warijyo on the exchange rate level.
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