'Rupiah to remain at 9,000 this week'<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
After hitting Rp 9,000 to the U.S. dollar again last Monday,
\nthe rupiah is likely to stay there in this week's trading one
\nanalyst said, citing continued foreign debt payments and concerns
\nover of a prolonged, weak U.S. economy.<\/p>\n
Bank Mandiri chief economist Martin Panggabean predicted the
\nrupiah would weaken towards the end of the year on pressure from
\nforeign debt payments, but might return to the 8,000 level
\ntemporarily.<\/p>\n
\"The rupiah's drop to 9,000 is about two months too early,\" he
\nsaid on Friday.<\/p>\n
Traders should watch the movements of major currencies against
\nthe U.S. dollars, as these would determine the direction the
\nrupiah would be heading for, he said.<\/p>\n
\"Will the dollar crash? If so, there is potential for a
\nstronger rupiah.\"<\/p>\n
The dollar may get hit by concerns over the U.S. economy. As
\nprospects on American stocks remained dim, and as the U.S. budget
\ndeficit swelled dangerously, the greenback was at risk, he said.<\/p>\n
Under this scenario, Martin said the rupiah was poised to gain
\nand return to the 8,000 level. \"But even if it does, it'll be
\ntemporary.\"<\/p>\n
Despite signs of the U.S. economy rising from its slump, a
\nslew of accounting scandals hurting Wall Street, and war talks in
\nthe Middle East have delayed the expected lift in the global
\neconomy.<\/p>\n
The government is counting on an improved global economy
\nduring the second semester, in hope for better export sales
\ntoward the end of this year.<\/p>\n
Last Monday the rupiah slid for the first time in six weeks to
\nthe 9,000 level mainly due to outside pressure. Japan's yen was
\ntrading lower to the dollar, dragging with it regional currencies
\nincluding the rupiah.<\/p>\n
Concerns of a U.S. attack against Iraq also rose while at home
\nthe weakening JSX index prompted currency players to buy dollars
\nin case foreigners sold off Indonesia shares.<\/p>\n
Bank Indonesia said it would defend the rupiah through market
\nintervention among others, yet only if its fall was too steep.
\nThe central bank has a policy of intervening but never disclose
\nspecific intervention volume.<\/p>\n
On Friday, the rupiah ended trading way down at 9,030 from
\n8,965 a week before.<\/p>\n
The Jakarta Stock Exchange (JSX) index would likely stay at
\naround 400 this week, said stock analyst Hengky Sumarli.<\/p>\n
He said stock prices are reasonable at these levels as the JSX
\nindex has fallen for several weeks now.<\/p>\n
\"That (400 points) will be the next support level,\" he said,
\nreasoning also that the index began this year at around 390.<\/p>\n
The JSX index closed Friday trading at 408.79 points,
\nsignificantly lower from last week's 421 points and around 427 in
\nearly September.<\/p>\n
Analysts said recent reports of the suspected presence of
\nterrorists in Indonesia had dampened stock investors appetites,
\nsince action against them might provoke a backlash among
\nhardliners here.<\/p>\n
But Hengky said that security was for now a minor concern.<\/p>\n
\"Next week trading will depend more on how developments are
\noutside,\" Hengky added. \"If global markets weakened this won't
\nspur well for the JSX.\"<\/p>\n
He said a plunge of the U.S. Dow Jones Index may drag the JSX
\nto below the 400 level.<\/p>",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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