Dollar exchange rate

Dollar exchange rate

From Kompas

As a layman, I find comments reported in the media on the appropriate exchange rate of the rupiah against the U.S. dollar ridiculous.

I am disappointed with the comment made by the newly appointed minister for trade and industry for taking the side of exporters, saying that the drop in the U.S. dollar exchange rate against the rupiah would be unfavorable to the country's export sector. She cited that some components had been purchased earlier when the U.S. dollar had increased in value against the rupiah. She forgets that these exporters had enjoyed the high exchange rate of U.S. dollar against rupiah and, as frequently reported, had even deposited their export proceeds in Singapore.

The Bank of Indonesia (BI) commented that the strengthening of rupiah would not necessarily harm exporters. Some experts said the market should determine the rate, while A Tony Prasetiantono referred to the price of a Big Mac. After the inflation rate and some other factors had been taken into account, the final figure for the exchange rate of the U.S. dollar against the rupiah came to Rp 7,500 per U.S. dollar. These comments as well as legislators' statements have frustrated me as none consider the ordinary people, most of whom live in abject poverty.

I propose that the appropriate rupiah exchange rate against U.S. dollar should be set at a level compatible with the average income of most Indonesians or fixed with reference to the depreciation prevailing in neighboring countries.

EDDY SUHAEDI

Jakarta