Aggressive U.S. dollar buying expected<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
In the first week of the new year, the currency market is
\nexpected to be more active with demand for dollar will remain
\nhigh, putting the rupiah under familiar pressure, an analyst
\nsaid.<\/p>\n
Noted currency analyst Farial Anwar told The Jakarta Post over
\nthe weekend, the opening days of trading would usually be
\nhighlighted by the more aggressive speculators.<\/p>\n
\"In early trading of the year, the market is likely to be more
\nactive, marked by the aggressive trading by speculators,\" Farial,
\nwho is also the director of PT Currency Management Group, said.<\/p>\n
Farial added that the wide margin between demand and supply of
\nthe dollar, coupled with the absence of pro-market monetary
\npolicies will keep weighing on the local currency.<\/p>\n
With the year-end festivities having come to an end, there
\nwill be less demand for the rupiah and there will be no reason
\nfor the local currency to strengthen.<\/p>\n
From November to the third week of December, rupiah was on the
\nupward trend, mostly due to strong demands for the currency ahead
\nof the year-end festivities.<\/p>\n
However, the rupiah got back to its declining trend as demand
\nfor rupiah lessened.<\/p>\n
Last week, rupiah closed at 10.450 against the American
\ngreenback, down from 10.180 in the previous week.<\/p>\n
And, as the demand for dollars remain strong while on the
\nother hand there is a lack of dollar supplies on the market,
\nFarial predicted the declining pattern of the rupiah would
\ncontinue.<\/p>\n
Demands for dollar will still come from importers and
\ncorporations who need to repay their huge foreign debts, and
\nspeculators.<\/p>\n
\"We cannot underestimate speculators, because facts show that
\nit is easier to speculate against the rupiah rather than the
\ndollar,\" he warned.<\/p>\n
On the contrary, the market is running out of resources to
\nsupply the dollar, with the global economic slowdown affecting
\nthe country's export performance and direct foreign investment.<\/p>\n
The exporters and investors are used to be the main suppliers
\nof dollars into the country.<\/p>\n
However, Farial forecasted the rupiah will go no lower than
\n10.500.<\/p>\n
Unlike the currency market, trading in the stock market will
\nremain subdued in the first week of the new year, according to an
\nanalyst.<\/p>\n
\"With most of the investors have yet to return from vacation,
\nI expect the market to remain quiet, especially in the first two
\nor three days of trading,\" Ario Ardhikari, an investment manager
\nat ABN Amro, told the post.<\/p>\n
There will be a small number of speculators, he added, but
\nwith the absence of big players and significant market stimulus,
\nboth the trading volume and the index movement will be hovering
\nat a narrow range.<\/p>\n
Last week, the Jakarta Stock Exchange Composite Index closed
\nat 392.03 points, up from 378.25 the week before.<\/p>\n
Ario cited the slight increase in last week's index as normal
\noccurrence to close the year, but he doubted the increase trend
\nto continue this week.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/aggressive-us-dollar-buying-expected-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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