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Rupiah Comes Under Pressure Amid Adjustment To Fed Bets


The rupiah underperforms in G10 FX space as latest rounds of hawkish Fedspeak decrease the relative attractiveness of Indonesian assets, as benign core inflation encourages Bank Indonesia not to rush with normalising policy.

  • Spot USD/IDR trades +12 figs at IDR14,925, with bulls looking for a rally towards Jul 22 high of IDR15,038. The 50-DMA provides the initial bearish target at IDR14,825.
  • USD/IDR 1-month NDF last +24 figs at IDR14,930. Topside focus falls on Jul 21 high of IDR15,133, followed by Jul 15 high of IDR15,190. Bears keep an eye on the 50-DMA, which intersects at IDR14,846.
  • MYR/IDR has added ~3 figs and now sits at IDR3,350. Bulls look for a further upswing towards Jul 22 high of IDR3,379. Bears set their sights on Aug 1 low of IDR3,331.
  • SGD/IDR last deals +14 figs at IDR10,811. Bulls look to a move towards Jul 28 high of IDR10,869, while bears take aim at yesterday's low of IDR10,743.
  • Indonesia's 5-year CDS premium has added 17bp his morning to last sit at 120bp. It keeps slowly retracing an earlier pullback from the Jul 15 peak of 164bp.
  • Palm oil futures dropped as trading in Kuala Lumpur re-opened, although the contract for October delivery has recovered from session lows and last deals at MYR3,790/MT.
  • Indonesia sought to occupy the middle ground amidst heightened Sino-U.S. tensions over Taiwan. Its Foreign Ministry called on both parties to deescalate the situation, adding that it respects the one-China policy.
  • Looking ahead, the latest set of Indonesian GDP data will be published tomorrow.

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