USD/IDR: No response to Indonesia's inflation data

Indonesian Rupiah is struggling to pick up a bid despite the above-forecast inflation data.
USD/IDR may revisit the stiff resistance at 14,300.

Omkar Godbole FXStreet Contributor

USD/IDR is seeing little action despite better-than-expected Indonesian inflation data.

The cost of living in the southeast Asian nation, as represented by the consumer price index (CPI), rose 0.44% month-on-month in April, bettering the Reuters estimate of 0.32% by a narrow margin.

Both the annualized headline figure and the core CPI also beat estimates with 2.83% and 3.05% print.

So far, however, the Indonesian Rupiah has not picked up a bid. As of writing, the currency pair is trading largely unchanged on the day at 14,244, having hit a high and low of 14,255 and 14,215 earlier today.

Indonesia's central bank is widely expected to start a rate cut cycle later this year. A sustained rise in inflation, however, may complicate matters for the central bank.

On the other hand, markets expect the Fed to cut rates in December. The Fed, however, sees no strong case for a move in either direction. In fact, Chairman Powell pushed back rate cut expectations by attributing low inflation to transitory factors on Wednesday.

The dollar, therefore, may pick up a bid during the day ahead, sending USD/IDR higher to 14,300, a level which has acted as stiff resistance in the last four days.

Pivot points

1. R3 14403.8333
2. R2 14349.6667
3. R1 14287.3333
PP 14233.1667
1. S1 14170.8333
2. S2 14116.6667
3. S3 14054.3333

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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