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Rupiah On Back Foot Ahead Of Bank Indonesia Decision This Week


Spot USD/IDR leaps higher today, last changes hands +49 figs at IDR15,471. Bulls look to take out the 61.8% retracement of the 2020 sell-off/Apr 23, 2020 high of IDR15,574/15,598. Bears keep an eye on Sep 30 low of IDR15,150.

  • USD/IDR 1-month NDF last -7 figs at IDR15,499. Bears would be pleased by a slide through Oct 5 low of IDR15,158. Bulls target the 50% recovery of the 2020 - 2021 slump located at IDR15,562.
  • Palm oil futures have slipped this morning, trimming gains registered last Friday, and last trade -MYR74/MT. The aggregate BBG Commodity Index is barely changed.
  • Foreign players sold a net $27.61 in Indonesian stocks last Friday, while the Jakarta Comp shed nearly 1%. The index has extended losses to fresh cyclical lows today, with the technical generating additional headwinds after support from the 200-DMA gave way last week.
  • Indonesia's trade data today are expected to show a decline in monthly surplus to $4.847bn in September from $5.760bn recorded in August. The annual growth in exports may have slowed to +28.60%.
  • Bank Indonesia will deliver its monetary policy decision this Thursday. Most (19/29) analysts surveyed by Bloomberg expect a 50bp hike to the 7-Day Reverse Repo Rate, while the rest have pencilled in a smaller 25bp rate rise.
  • Some analysts are casting doubt on the effectiveness of Bank Indonesia's "Operation Twist" in luring foreign capital into short-dated local debt, as U.S./Indonesia 5-year yield spread operates near multi-year narrows, even as it may have helped keep INDOGB 5-Year/10-Year gap in check.

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