2:34 AM
AGHA
July 22th has gone. The official anouncement said that Jokowi was elected President of my beloved country, Indonesia. As we know, the survey before showed that the society had high expectation for Jokowi to be President. And today, we'll just wait for Jokowi's inaugural speech.
Economists forecasted that Rupiah would get stronger after the election. We still remember when Jokowi was nominated as the future president, the Indonesia Composite Index (IHSG) moved up. But now, as Jokowi's named as the President-elect, Rupiah gives no sign of any "raise". Rupiah is still in USD/IDR 11,500 - 11,700.
What can possibly affect Rupiah?
We have many explanations. First, US Economic grows faster this year; 4% (until Q2) based on fxstreet.com while US GDP 2014 (until Q2) grows 2.8% based on statista.com the highest growth since 2008 global crisis. This makes USD moves stronger against its pair. GBP/USD, NZD/USD, and EUR/USD even get weaker (1.6876, 0.8493, and 1.3387 consecutive). This condition will surely affect Rupiah, too.
Second, the inflation rate is still higher than Bank Indonesia targeted (inflation target for 2014 is 4.5% while June inflation is 6.7% (see http://www.bi.go.id/en/moneter/inflasi/data/Default.aspx). BI rate (7.5%) and Net Domestic Assets position could affect rupiah, too.
Last, though the presidential election had declared that Jokowi was the winner, his opponent, Prabowo, is disputing the outcome. This case is now brought to Constitutional Court. I assume Rupiah won't make a good movement till the Constitutional Court's fixed result on the 6th of August. Well, let's wait another days and see what will happen to Rupiah.
By the way, you can shift your focus to US NFP data release. Have a nice trading.
Second, the inflation rate is still higher than Bank Indonesia targeted (inflation target for 2014 is 4.5% while June inflation is 6.7% (see http://www.bi.go.id/en/moneter/inflasi/data/Default.aspx). BI rate (7.5%) and Net Domestic Assets position could affect rupiah, too.
Last, though the presidential election had declared that Jokowi was the winner, his opponent, Prabowo, is disputing the outcome. This case is now brought to Constitutional Court. I assume Rupiah won't make a good movement till the Constitutional Court's fixed result on the 6th of August. Well, let's wait another days and see what will happen to Rupiah.
By the way, you can shift your focus to US NFP data release. Have a nice trading.
