JAKARTA \u2014 As the Rupiah has weakened recently, many individuals have\nbeen making financial errors in an attempt to protect their asset\nvalues. Several economists and financial planners suggest that exchange\nrate volatility often triggers emotional and risky financial decisions,\nranging from hoarding dollars when rates are high to using emergency\nfunds for speculation.<\/p>\n
Common financial mistakes during Rupia weakness include panicking and\nconverting all savings into US dollars. Josua Pardede, Chief Economist\nat Bank Permata, revealed that the most common error is converting\nentire Rupiah savings into US dollars once the exchange rate is already\nhigh. He noted that US dollar holdings should be adjusted based on\nactual needs; if income and expenses are primarily in Rupiah, holding\nexcessive dollars becomes a risky form of speculation.<\/p>\n
Pardede added that keeping money in banks remains safe, provided the\nbanks are supervised by the Financial Services Authority (OJK) and\ndeposits meet the guarantee requirements of the Deposit Insurance\nCorporation (LPS). Furthermore, OJK data indicates that the banking\nsector maintains adequate liquidity, with third-party funds growing by\n13.55 per cent to Rp 10,231 trillion as of March 2024, and credit\ngrowing by 9.4 per cent to Rp 8,659 trillion.<\/p>\n
Other frequent mistakes include using emergency funds to purchase\nrisky assets, taking on debt to buy foreign exchange, delaying loan\nrepayments in hopes of a better rate, or buying US dollars without a\nclear purpose. Pardede warned that the greatest risk during Rupiah\nweakness is not just the exchange rate, but the impact on monthly cash\nflow. As long as income remains in Rupiah, the priority should be\nmaintaining emergency funds, paying instalments on time, reducing\nconsumer debt, and postponing non-essential large purchases. He\nemphasised that emergency funds for 3 to 6 months should remain in\nRupiah via savings accounts or deposits, as daily expenses are\npredominantly in Rupiah.<\/p>\n
Similarly, Melvin Mumpuni, a financial planner from Finansialku,\nnoted that many people deplete their emergency funds to buy US dollars\nor other assets out of fear of missing a market momentum. He stressed\nthat emergency funds must be prioritised for urgent needs rather than\nbeing used for speculation during market volatility.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/strategise-during-rupiah-weakness-avoid-rushing-to-buy-dollars-1780925512", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }