Foreign exchange traders enjoy brisk business

JAKARTA (JP): As the rupiah continued to strengthen on Thursday after the People's Consultative Assembly voted Hamzah Haz as the new Vice President, some people rushed to sell their dollars, fearing that rates would continue to fall.

The rupiah closed at 9,775 to the US dollar, as against 9,960 before Hamzah's victory.

According to unregistered foreign exchange traders at Pasar Baru, Central Jakarta, more people had been selling dollars in the past couple of days.

"Most of them were African or Middle Eastern," a trader named Bahrum told The Jakarta Post on Thursday.

"They were afraid that the rupiah would continue to strengthen," he added.

One foreigner, Bahrum said, exchanged as much as US$2,000.

He added that the foreigners were reluctant to use official money changers as the rates were usually lower.

"We sell according to official rates. But that also depends on the availability," Bahrum asserted.

The strengthening of the rupiah against the U.S. dollar also caused a decrease in cellular phone prices.

Shop owners at cellular phone center ITC Roxy Mas in Central Jakarta reported a price slump of up to Rp 200,000.

A Siemens M35, for example, dropped from over Rp 1.4 million ($140) to Rp 1.38 million.

"The price of another cell phone reduced by around Rp 100,000 to Rp 200,000," said Mery, an employee at Sumber Phone.

She added that the prices dropped since the rupiah strengthened against the dollar a couple of days ago.

Kikin, owner of May Cellular shop said that even though the rupiah had strengthened, sometimes it did not automatically affect the price of cell phones.

"Yes, the value of the (rupiah against the) dollar influences the price. But if the supply is short, the price stays the same," she said.

Meanwhile, at Glodok electronics center in Central Jakarta, prices remained the same as before the strengthening of the rupiah.

According to a shop owner, though, prices are likely to decrease.

"But I think it won't be much, only around five percent, I guess. At the moment the price is still the same," he said, without elaborating.

For a few days, due to the escalating political tension leading up to the People's Consultative Assembly's Special Session, business was sluggish in most parts of the country, including Glodok. Things returned to normal after Megawati Soekarnoputri was elected as the country's fifth president. (hdn)