Rupiah gains stronger ground

The Jakarta Post, Jakarta

The rupiah surged to breach the 10,000 level against the U.S. dollar on Wednesday trading, as corporate demand for the foreign unit declined ahead of year's end, dealers said.

Players taking profit on the weak dollar dragged the rupiah back to old territories albeit at 10,210 still higher than Tuesday's closing at 10,220

The rupiah's sharp gains marked a turnaround for the battered local unit, which has been hovering at above 10,000 since last October.

Bank Indonesia Governor Sjahril Sabirin attributed the rupiah's recent surge on an upswing in market sentiment.

He said the market took confidence in the rupiah following the successful sales of two state companies.

These were the telecommunication firm PT Telkom Indonesia, which sold for some US$300 million, and plantation firm PT Socfindo, which sold for around $40 million.

Sjahril said the central bank had intervened in the money market, but added the amount had been too insignificant to have helped the rupiah much.

The Indonesian Bank Restructuring Agency (IBRA) was also seen converting dollars from the proceeds of its asset sales program.

IBRA secured several large deals this month as it went after its target to raise Rp 27 trillion (about $2.64 billion) in cash.4