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