• USD/IDR pauses three-day uptrend after upbeat prints of Indonesia Q2 GDP.
  • Yields underpin US dollar rebound ahead of US NFP.
  • Indonesia palm oil prices struggle but coal manages to keep rupiah buyers hopeful.

USD/IDR takes offers to refresh intraday low around 14,900 on upbeat Indonesia Q2 Gross Domestic Product (GDP) during Friday’s Asian session. Even so, the US dollar rebound amid the pre-NFP anxiety challenges the pair buyers.

That said, Indonesia’s second quarter (Q2) GDP was up 5.44% from a year earlier, showing the fastest growth rate in a year, according to Statistics Indonesia data. The GDP figures crossed 5.17% market forecasts and 5.01% prior.

“Prices of palm oil, one of the country's top export products, have plunged in recent months, but Indonesian coal prices are still hovering around record highs due to strong demand from such markets as Europe,” said Reuters following the data release. The news also mentioned that Indonesia's central bank (Bank Indonesia) said last month the rise in full-year 2022 GDP from 2021 would be at the lower end of the range of 4.5% to 5.3%. It previously forecast growth in the middle of that range.

Elsewhere, the US 10-year Treasury yields stabilize around 2.069% after declining in the last two days. Even so, the US Treasury yields continued to portray the risk of recession as the difference between the 10-year and 2-year bond coupons remain the widest since 2000. However, Wall Street closed mixed and the S&P 500 Futures print mild gains while taking rounds to the two-month high flashed the previous day, up 0.23% intraday around 4,162 by the press time.

Other than the pre-NFP anxiety and recession woes, news that China’s missiles landed on Japan’s exclusive economic zones raised market fears and challenge USD/IDR bears. The dragon nation conducted heavy military drills near the Taiwan border after US House Speaker Nancy Pelosi visited Taipei against Beijing’s warning.

Moving on, USD/IDR bears are likely to witness hardships unless the US data disappoint traders. Forecasts suggest that the US Nonfarm Payrolls (NFP) for July could ease to 250K versus 372K prior.

Technical analysis

Given the successful rebound from the 50-day EMA, USD/IDR appears capable of breaking the immediate hurdle surrounding 15,000 round figure ahead of July’s peak surrounding 15,030.

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