Covid Impact: has had to react to many challenges(government restrictions, border closings, flight cancellations etc…) All orders are shipped in the order in which they are approved. Approved Redemptions are always processed within 24 hours. We appreciate your business and we are working diligently to get back to normal as quickly as possible. Please be safe. *** VND IS BACK IN STOCK ***

Currency News

Rupiah Drops Most in Six Weeks After Indonesia Cuts GDP Estimate

The rupiah fell the most in six weeks after Indonesia cut its economic growth forecast and as a report from China added to concern that a slowdown in Asia’s largest economy is worsening.

The Indonesian parliament’s finance commission agreed late on Tuesday to lower the expansion projection in the 2016 budget to 5.3 percent from 5.5 percent. A preliminary factory gauge released Wednesday in China, Indonesia’s largest trading partner, missed estimates and dropped to the lowest since 2009. Investors are still waiting to see when the Federal Reserve will raise interest rates, a move that’s expected to sap demand for emerging-market assets.

The rupiah declined 1 percent, the most since Aug. 12, to close at 14,647 a dollar, prices from local banks show. It fell to 14,661 earlier, the weakest level since July 1998, and is down 15 percent this year in Asia’s worst performance after Malaysia’s ringgit.


“The rupiah continues to decline as markets pare their expectations,” said David Sumual, chief economist at PT Bank Central Asia, the nation’s largest lender by market capitalization. “This growth estimate is more realistic. At this stage, with the Fed still clouding the outlook and China continuing to slow, it’s better to be conservative than see another revenue shortfall.”

The economy can still grow by as much as 5 percent this year, Finance Minister Bambang Brodjonegoro said Monday, adding that the government has only met 60 percent of its spending target for 2015. Indonesia’s gross domestic product increased 4.67 percent in the second quarter from a year earlier, the least since 2009.

The government will seek multilateral loans from the World Bank or the Asian Development Bank and considers selling $800 million to $1 billion of global bonds to fund a budget deficit that may be wider than 2.23 percent of GDP this year, compared with the previous estimate of 1.9 percent, Scenaider Siahaan, a director at Finance Ministry’s budget financing and risk management office, said on Tuesday.

Government bonds due September 2026 declined, pushing the yield up 23 basis points to 9.42 percent, Inter Dealer Market Association prices show. That was the biggest increase since Sept. 7.

original source:

Back to Top