Tuesday, June 3, 2014

Rupiah Falls to 3-Month Low on Widest Trade Deficit Since July

Indonesia’s rupiah extended its drop to a three-month low after the nation reported the widest trade deficit in nine months.

Imports exceeded exports by $1.96 billion in April, compared with the median estimate of 20 economists surveyed by Bloomberg for a $178 million surplus, official data showed today.

Indonesians will head to polls on July 9 to choose a new president, with frontrunner Joko Widodo facing off against Prabowo Subianto, whose coalition includes Golkar, the nation’s second-largest party.

“The trade number came in far out of consensus,” said Irene Cheung, a Singapore-based currency strategist at Australia & New Zealand Banking Group Ltd. “Together with the uncertainty surrounding the election, we still see risks for the rupiah.”

The rupiah fell 0.8 percent to close at 11,765 per dollar, prices from local banks show. It touched 11,789 earlier, the weakest level since Feb. 21. In the offshore market, one-month non-deliverable forwards dropped 0.4 percent to 11,817 per dollar, data compiled by Bloomberg show.

Inflation (IDCPIY) quickened to 7.32 percent in May, compared with the 7.30 percent median estimate in a Bloomberg survey and 7.25 percent in April, a separate report showed today.

One-month implied volatility, a measure of expected swings in the exchange rate used to price options, climbed 20 basis points, or 0.20 percentage point, to 9.31 percent.

Bank Indonesia set a fixing used to settle the rupiah forwards at 11,740 per dollar today, from 11,611 on May 30. The yield on the government’s 8.375 percent bonds due March 2024 rose one basis point to 8.07 percent, the highest level since May 13, according to the Inter Dealer Market Association.

bloomberg.com

No comments:

Post a Comment