Indonesia’s rupiah retreated the most in a week on concern slowing economic growth in China, the nation’s largest trading partner, will weigh on exports.
Indonesia’s overseas shipments have fallen for 12 straight months through September amid declining prices for its main raw- materials exports including coal, palm oil and metals.
China’s economy expanded 6.9 per cent in the last quarter from a year earlier, the weakest pace since 2009, while industrial-output growth for September fell short of economists’ estimates, official data showed yesterday.
That led to the Bloomberg Commodity Index’s biggest drop in a month as the world’s second- largest economy is the top consumer of energy, metals and grains.
“Weaker Chinese growth means commodity prices will remain weak, so that won’t bode well for Indonesia’s exports,” said Agus Yanuar, chief investment officer at PT Samuel Aset Manajemen in Jakarta.
“On the domestic side, we’re waiting for signs that public spending is beginning to trigger private- sector investments as that’s what will revive economic growth.”
The rupiah declined 0.8 per cent to 13,635 a dollar as of 9:18am in Jakarta, according to prices from local banks.
It has slumped 9.2 per cent this year in Asia’s worst performance after the Malaysian ringgit. Indonesia’s economy grew 4.7 per cent in the second quarter, the least since 2009, official data show.
The yield on Indonesia’s 10-year bonds climbed for the first time in four days, rising two basis points to 8.67 per cent, according to the Inter Dealer Market Association.
original source: http://www.themalaymailonline.com/money/article/rupiah-falls-most-in-a-week-as-china-slowdown-weighs-on-exports#sthash.SDX7IvNf.dpuf