Indonesia: FX reserves shrank further in September – UOB

Pablo Piovano FXStreet

UOB Group’s Economist Enrico Tanuwidjaja and Junior Economist Agus Santoso review the latest FX reserves figures in Indonesia.

Key Takeaways

Indonesia’s foreign exchange reserves fell by USD2.2bn to USD134.9bn in Sep 2023.

The latest reserves level was equivalent to financing 6.1 months of imports or 6 months’ worth of imports and external government debt servicing, well above the international adequacy standard of 3 months of imports.

The figure reaffirms that exports revenue in Sep is expected to be flattish. Some indicators we looked at in Sep were commodity prices declining and lower demand from India and China as Indonesia’s main trading partners. Going forward, we maintain our forecast of Indonesian FX reserves to remain in high levels of around USD135bn to USD145bn at the end of this year on the back of better outlook especially from coal demand and inflows into the bond market.

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

EUR/USD trims gains, back below 1.1800

EUR/USD now loses some upside momentum, returning to the area below the 1.1800 support as the Greenback manages to regain some composure following the SCOTUS-led pullback earlier in the session.

GBP/USD off highs, recedes to the sub-1.3500 area

Following earlier highs north of 1.3500 the figure, GBP/USD now faces some renewed downside pressure, revisiting the 1.3490 zone as the US Dollar manages to regain some upside impulse in the latter part of the NA session on Friday.

Gold climbs to weekly tops, approaches $5,100/oz

Gold keeps the bid tone well in place at the end of the week, now hitting fresh weekly highs and retargeting the key $5,100 mark per troy ounce. The move higher in the yellow metal comes in response to ongoing geopolitical tensions in the Middle East and modest losses in the US Dollar.