Rupiah Firms, Stays On Track For Weekly Gain

Spot USD/IDR dropped to its worst levels this month as onshore markets re-opened, digesting the moderation in hawkish Fed expectations, which occurred on the back of a disappointing U.S. GDP print. The pair has now trimmed some losses, but still changes hands 59 figs below neutral levels, last at IDR14,874. Technical focus turns to the downside, as the RSI returned from overbought territory, plunging firmly below the 70 threshold. A slide through the 50-DMA (IDR14,808) and the IDR14,794-14,784 support area formed by the low prints of Jun 27 & 21 would signal that bearish momentum is intensifying. Bulls need a rebound above Jul 22 high of IDR15,038 to regain poise.

• USD/IDR 1-month NDF last seen at IDR14,876, unchanged on the day after printing a new monthly low (IDR14,845) earlier in the session. Should bears force a break below the 50-DMA at IDR14,824, they could set their sights on Jun 27 low of IDR14,788 eyeing a deeper sell-off. Bulls look for recovery past Jul 21 high of IDR15,133 and towards Jul 15 high of IDR15,190.
• Palm oil futures gained in Thursday's after-hours trade, finishing +MYR87/MT at MYR4,044/MT. Indonesia's shipments will continue to attract attention, with the nation trying to boost exports and drain overflowing storage tanks.
• Jakarta Comp Index has firmed in morning trade, lodging a fresh one-month high. It tested resistance from the 61.8% retracement of its Apr - May sell-off but has struggled to move beyond there so far and eased off highs.
• Indonesia's 5-year CDS premium extended its dramatic retreat from the Jul 15 cycle high this week, despite a 75bp rate hike announced by the Fed. It now sits at 108bp, around 57bp below peak levels.
• President Joko Widodo returned from his East Asia trip, announcing at least $13bn in investment pledges and business deals.
• Next week will bring the release of Indonesia's July CPI date (Monday) & Q2 GDP (Friday).