Free Trial
EURJPY TECHS

Price Is Below The 50-Day EMA

US

Late Corporate Credit Update

US TSY OPTIONS

BLOCK, 10Y Weekly Midcurve Put Spd

Real-time Actionable Insight

Get the latest on Central Bank Policy and FX & FI Markets to help inform both your strategic and tactical decision-making.

Free Access

Bank Indonesia Boosts Efforts To Mop Up Liquidity But Stands Pat On Policy Rate

IDR

The rupiah went offered as Bank Indonesia kept its 7-Day Reverse Repo Rate unchanged at the record low of 3.50% on Thursday, disappointing those market participants with a more hawkish orientation.

  • We were siding with 22 out of 36 economists surveyed by Bloomberg who expected Bank Indonesia to keep the key policy rate unchanged. But the remaining 14 analysts called for a 25bp rate hike amid clear indications that pressure is mounting on the Board of Governors to act.
  • The rationale for keeping the key rate unchanged echoed the Bank's familiar views on the need to strike a balance between fighting inflation and downside risks to growth. The Bank upgraded its inflation forecasts, but saw core price growth remaining within the target range.
  • In a subsequent call with investors, Governor Warjiyo said the central bank will sell off ~IDR70tn of short-term government bonds to accelerate the absorption of excess liquidity, before moving on to offloading 5- to 10-year bonds.
  • Spot USD/IDR last trades at IDR15,030, little changed on the day. The next layer of resistance is provided by May 5, 2020 high of IDR15,138. Bears look for a dip through Jul 18 low of IDR14,955.
  • USD/IDR 1-month NDF last seen -27 figs at IDR15,080. Bears look for a slide through Jul 8 low of IDR14,966, while bulls eye a jump towards Jul 15 high of IDR15,190.
  • MYR/IDR changes hands at IDR3,372, barely changed on the day. The next key resistance level has been defined at IDR3,400. Conversely, bears look for a plunge under Jul 19/Jun 27 lows of IDR3,359/3,358.
  • SGD/IDR trades at IDR10,8078, up ~28 figs on the day after printing fresh cycle highs. Gains past May 26, 2021 high of IDR10,830 would reaffirm underlying bullish momentum. Bears need a fall through the 50-DMA/Jul 12 low at IDR10,650/10,636 to get some reprieve.
295 words

To read the full story

Why Subscribe to

MarketNews.com

MNI is the leading provider

of news and intelligence specifically for the Global Foreign Exchange and Fixed Income Markets, providing timely, relevant, and critical insight for market professionals and those who want to make informed investment decisions. We offer not simply news, but news analysis, linking breaking news to the effects on capital markets. Our exclusive information and intelligence moves markets.

Our credibility

for delivering mission-critical information has been built over three decades. The quality and experience of MNI's team of analysts and reporters across America, Asia and Europe truly sets us apart. Our Markets team includes former fixed-income specialists, currency traders, economists and strategists, who are able to combine expertise on macro economics, financial markets, and political risk to give a comprehensive and holistic insight on global markets.

The rupiah went offered as Bank Indonesia kept its 7-Day Reverse Repo Rate unchanged at the record low of 3.50% on Thursday, disappointing those market participants with a more hawkish orientation.

  • We were siding with 22 out of 36 economists surveyed by Bloomberg who expected Bank Indonesia to keep the key policy rate unchanged. But the remaining 14 analysts called for a 25bp rate hike amid clear indications that pressure is mounting on the Board of Governors to act.
  • The rationale for keeping the key rate unchanged echoed the Bank's familiar views on the need to strike a balance between fighting inflation and downside risks to growth. The Bank upgraded its inflation forecasts, but saw core price growth remaining within the target range.
  • In a subsequent call with investors, Governor Warjiyo said the central bank will sell off ~IDR70tn of short-term government bonds to accelerate the absorption of excess liquidity, before moving on to offloading 5- to 10-year bonds.
  • Spot USD/IDR last trades at IDR15,030, little changed on the day. The next layer of resistance is provided by May 5, 2020 high of IDR15,138. Bears look for a dip through Jul 18 low of IDR14,955.
  • USD/IDR 1-month NDF last seen -27 figs at IDR15,080. Bears look for a slide through Jul 8 low of IDR14,966, while bulls eye a jump towards Jul 15 high of IDR15,190.
  • MYR/IDR changes hands at IDR3,372, barely changed on the day. The next key resistance level has been defined at IDR3,400. Conversely, bears look for a plunge under Jul 19/Jun 27 lows of IDR3,359/3,358.
  • SGD/IDR trades at IDR10,8078, up ~28 figs on the day after printing fresh cycle highs. Gains past May 26, 2021 high of IDR10,830 would reaffirm underlying bullish momentum. Bears need a fall through the 50-DMA/Jul 12 low at IDR10,650/10,636 to get some reprieve.