Rupiah stabilizes but more attacks expected<\/p>\n
JAKARTA (JP): The Indonesian rupiah was stabilizing against
\nthe U.S. dollar yesterday, but dealers warned that attacks on the
\nrupiah would continue this week.<\/p>\n
Dealers said the rupiah was on the way to recovery before
\nfresh pressure on the baht spilled over to the rupiah and other
\nregional currencies and pushed rates lower against the dollar.<\/p>\n
Dealers said the rupiah strengthened to a high of 2,530\/2,535
\nfrom 2,570\/80 open following a thin intervention from Bank
\nIndonesia, the central bank, but fell again to 2,585\/95 at close.<\/p>\n
The Jakarta stock index also gained ground, closing 0.95
\npercent higher yesterday to 718.18 on the back of mild gains in
\nheavyweight stocks following a slight strengthening in the
\nrupiah, brokers said.<\/p>\n
Economist Sjahrir said that current speculative attacks on the
\nrupiah were temporary and predicted they would ease by the end of
\nthis week.<\/p>\n
\"The assaults on the rupiah are temporary. The rupiah is
\nexpected to reach an equilibrium level later this week,\" Sjahrir
\ntold journalists after attending a seminar on the 1996 economic
\ncensus.<\/p>\n
He said there was no ground to speculate that a rupiah
\ndevaluation was imminent.<\/p>\n
\"As the movement of the rupiah is still within the
\n(intervention) band, there is no need to devalue the currency,\"
\nSjahrir said.<\/p>\n
Minister of Finance Mar'ie Muhammad reiterated Tuesday that
\ndevaluation was entirely out of question in the current managed
\nfloating policy on the rupiah.<\/p>\n
In the current policy framework, there would be only
\ndepreciation or appreciation of the rupiah, Mar'ie said.<\/p>\n
Dealers said the rupiah was trapped in range trading
\nthroughout the day, with minor intervention by Bank Indonesia but
\nnew jolts in Thailand eroded the central bank's initiative.<\/p>\n
\"After the rupiah strengthened, overseas players showed their
\nresistance and this drove investors, including local
\ncorporations, to hedge their rupiah position against the dollar,\"
\na dealer with a local foreign exchange bank said.<\/p>\n
He said the baht spillover triggered operators to buy swaps,
\nwhose rises were limited because the market had been long.<\/p>\n
One-month swap remains stable at 18.0\/20.0 points, two at
\n37.0\/42.0, three at 60.0\/66.0 and six at 118.0\/125.0.<\/p>\n
Bank Indonesia yesterday raised again overnight rates for
\nshort-term papers (SBI) to 13.0 percent from 12.0 percent to
\ndiscourage speculators from borrowing rupiah to buy dollar.<\/p>\n
The central bank maintained the rate for five-six-day SBI at
\n12.0 percent, two-week at 8.5 percent, one-month at 10.5 percent,
\nthree at 11.0 percent, six at 11.66 percent and one-year at 12.25
\npercent.<\/p>\n
The central bank kept its intervention band at 2,378\/2,682 but
\nlowered the conversion band to 2,549\/2,597 yesterday from
\n2,576\/2,624 Tuesday.<\/p>\n
Stockbrokers said foreign and local investors in the capital
\nmarket were entering the market again as confidence in the rupiah
\nhad returned.<\/p>\n
\"I think most investors have realized that the panic in the
\nearly week has gone because the rupiah has slowly recovered,\"
\npresident of Harita Securities Christina Lim said yesterday.<\/p>\n
\"The strong trading activities are based on a technical
\nrebound after it declined sharply in the early week,\" she said.<\/p>\n
Total trading turnover reached 273.59 million shares changing
\nhand on the regular market valued at Rp 735.21 billion (US$288.31
\nmillion).<\/p>\n
A dealer with a joint-venture brokerage firm said some
\ninvestors were still waiting for further development of the
\nrupiah while others were confident the rupiah would not drop
\nfurther.<\/p>\n
\"These confident investors entered the market and supported
\nthe increase in trading activities yesterday,\" the dealer said.<\/p>\n
Several big cap stocks gained higher yesterday including PT
\nTelkom by Rp 125 to close at Rp 4,000, Indosat by Rp 150 to Rp
\n7,550, cigarette maker Gudang Garam by Rp 100 to Rp 9,375 and
\nSampoerna by Rp 25 to Rp 9,225. (aly\/rid)<\/p>\n
Shanghai -- Page 10<\/p>\n
Slippery -- Page 11<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/rupiah-stabilizes-but-more-attacks-expected-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }