- USD/IDR struggles to keep the rebound from weekly low.
- Indonesia registers record covid-led death toll, keeps budget deficit target of 5.7% of GDP.
- Bank Indonesia may hold a 7-day reverse repurchase rate at 3.50%, where it has been since February.
- Market sentiment dwindles amid Japan off, pre-ECB lull.
USD/IDR prints mild gains of 0.18% intraday, seesaws around 14,500, heading into Thursday’s European session. In doing so, the Indonesian rupiah (IDR) pair snaps a two-day downtrend but the recovery moves lack strength ahead of the Bank Indonesia (BI) Rate decision.
Indonesia’s IDX Composite track S&P 500 Futures to remain positive amid a lackluster session due to the Marine Day off in Japan and the market’s cautious mood ahead of the ECB. Even so, the coronavirus woes in the world’s fourth most populous country keep the IDR pressured.
Reuters highlight the nation’s record high covid-led death of 1,383 even as the daily infections. The same is the case with the UK where the death toll jumped 50% weekly. Australia, unfortunately, leads the covid woes with the 10-month high infections and over 50% lockdown in the nation.
On a different page uncertainty surrounding US President Joe Biden’s infrastructure spending and budget passage, as well as the Sino-American tussles, challenge the market’s mood, keeping the US dollar afloat.
At home, Finance Minister Sri Mulyani Indrawati said on Wednesday, per Reuters, “Indonesia's budget deficit target will be kept at 5.7% of gross domestic product and the government will cut the allocation for other areas to cover for rising spending on health care and welfare programs.”
Looking forward, USD/IDR traders will pay attention to the BI decision even if the Indonesian central bank isn’t expected to act. The reason is the search for any fresh comments amid the covid woes at home. In this regard, Reuters said, “BI last week slashed its 2021 GDP growth forecast to 3.8% from 4.6%, based on an initial assessment and assuming containment measures will effectively control the outbreak within a month. Indonesia's GDP shrank 2.1% last year, the first contraction since 1998, due to the fallout of the pandemic.”
The poll also mentioned, “All 23 analysts in the poll who gave medium-term forecast expect no change in the benchmark rate until the end of the year, with a minority tipping a 25-bps hike in the first quarter of 2022.”
Although the $14,670–700 region becomes a tough nut to crack for the USD/IDR bulls, sellers may refrain from fresh entries above the 100-DMA level of $14,430.
Additional important levels
|Today last price||14498|
|Today Daily Change||26.0500|
|Today Daily Change %||0.18%|
|Today daily open||14471.95|
|Previous Daily High||14630|
|Previous Daily Low||14445.3|
|Previous Weekly High||14595.5|
|Previous Weekly Low||14424.65|
|Previous Monthly High||14635.9|
|Previous Monthly Low||14151.35|
|Daily Fibonacci 38.2%||14515.8554|
|Daily Fibonacci 61.8%||14559.4446|
|Daily Pivot Point S1||14401.5|
|Daily Pivot Point S2||14331.05|
|Daily Pivot Point S3||14216.8|
|Daily Pivot Point R1||14586.2|
|Daily Pivot Point R2||14700.45|
|Daily Pivot Point R3||14770.9|
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.