Rupiah weakens slightly on imports demand<\/p>\n
Dow Jones, Jakarta<\/p>\n
The rupiah slipped slightly against the greenback on Thursday in
\na day of slow trading punctuated by state oil and gas company
\nPertamina's dollar purchases, traders said.<\/p>\n
The dollar closed at Rp 9,655, from its close on Wednesday at
\nRp 9,648.<\/p>\n
\"The trading is very slow now because there is not much demand
\nflow from the customers...but the oil company still wants to buy
\ndollars,\" a dealer at a foreign bank said.<\/p>\n
Indonesian corporates traditionally pay their foreign currency
\ndenominated debts at end-month, prompting intense dollar
\npurchases.<\/p>\n
Pertamina is scrambling to comply with a government directive
\nto increase its fuel reserves to cover consumption for 20 days
\nfrom a current level of 12 days.<\/p>\n
Traders linked the easing in the trading volume on Thursday to
\ngrowing investor acceptance of new foreign exchange regulations
\nannounced last week.<\/p>\n
Bank Indonesia will implement next month regulations that will
\nrestrict the amount of dollars banks can borrow from offshore
\ncounterparts without underlying transactions at $1 million.
\nPreviously, there was no cap on the amount.<\/p>\n
Central bank officials have said that the move is aimed at
\nreducing the amount of speculative offshore money coming into
\nIndonesia, which can destabilize the exchange rate.<\/p>\n
The announcement of the new rules prompted investor volatility
\nthat drove down the rupiah against the dollar earlier late last
\nweek and earlier this week.<\/p>\n
\"Today I think people are reconsidering and consolidating
\nabout what to do next,\" a trader said.<\/p>\n
\"I'm not saying everything has settled down completely...but I
\ndon't see an immediate need for investors to convert their rupiah
\nproceeds into dollars.\"<\/p>\n
Dealers expect the dollar to trade between Rp 9,630 and Rp
\n9,655 on Friday.<\/p>\n
Meanwhile, Jakarta shares ended slightly higher as bargain
\nhunters bought back a mixture of blue chips and second liners,
\nfollowing recent corrections, dealers said.<\/p>\n
The Jakarta Stock Exchange's Composite Index closed up 0.2
\npercent, or 2.73 points, at 1,137.42. The index touched an
\nintraday high of 1,146,59 before profit taking trimmed the gains.<\/p>\n
Gainers led decliners 58 to 53 with 84 stocks unchanged.
\nVolume traded was 958.5 million shares, worth Rp 1.2 trillion
\ncompared with 1.5 billion shares valued at Rp 1.4 trillion on
\nWednesday.<\/p>\n
\"Buying interest was not really strong today as most blue
\nchips still look overbought,\" a dealer with a local securities
\nfirm said.<\/p>\n
\"We recommended that our clients take profit on rally.\"<\/p>\n
Leading the market's rise was the nation's largest cigarette
\nmaker Gudang Garam, which rose 3.6 percent to Rp 12,950 after a
\nrecent slide sparked by concerns the government's plan to raise
\nminimum cigarette retail prices would hurt Gudang Garam's
\ncigarette sales.<\/p>\n
State-run Bank Negara Indonesia (BNI) gained 3.9 percent to
\nend at Rp 1,880. Its smaller sister Bank Rakyat Indonesia (BRI)
\nedged up 0.9 percent to finish at Rp 2,875.<\/p>\n
Gold and nickel miner Aneka Tambang rose 2.1 percent to Rp
\n2,450, with rupiah weakness expected to boost the company's
\nexports revenues.<\/p>\n
Telecommunications company Indosat was up 0.9 percent at Rp
\n5,600, but its rival Telkom dropped 1 percent to Rp 4,950 on
\ncontinued profit taking.<\/p>\n
Bank Mandiri was also hurt by profit taking, down 0.7 percent
\nat Rp 1,510.<\/p>\n
Dealers said they expect shares trade flat to lower on Friday
\nas the market seeks fresh impetus. The local bourse is expected
\nto look to Wall Street for direction.<\/p>",
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"sponsor": "Okusi Associates",
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