The Indonesian rupiah edged down on Wednesday after an official with the central bank said intervention with the currency will help exports, according to Bloomberg.
Monetary weakness will drive competition and slash imports, senior deputy governor Mirza Adityaswara with the central bank said. Indonesia is set to elect a new president early next month, and the aspirations of frontrunner Joko Widodo could be waning and weighing on the performance of the monetary unit, according to Reuters. The election is scheduled for July 9.
"Given that market has broadly positioned for a Jokowi presidency, the immediate knee-jerk reaction to that potential result could well be rather adverse, compounded by record-high foreign ownership of sovereign bonds," states a Wednesday note authored by economist Wellian Wiranto with OCBC Bank in Singapore, according to Reuters.
The Indonesian rupiah fell roughly 0.8 percent against the greenback on Wednesday. The rupiah dropped to its lowest level since mid February earlier during the trade session.
In April, Indonesia's trade shortfall widened to the equivalent of $1.96 billion, touching the biggest gap since July of last year, according to Bloomberg.
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any third-party trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.