Rupiah Sags After Indonesia Extends Movement Restrictions In Java & Bali

USD/IDR has continued to rise after crossing above its 50-DMA last Friday, following weekend news that movement curbs in Java & Bali will be prolonged. The rupiah has found little to no reprieve in the issuance of the implementing rules of Indonesia's investment law overhaul. The rate last deals +42 at IDR14,107.

• Indonesia released the details of its omnibus investment bill, which includes 51 implementing rules, two of which were issued in 2020. The legislation includes cuts to taxes on earnings from debt securities by non-resident taxpayers, general simplification of business permits as well as new permit requirements for palm oil plantations.
• Meanwhile, Indonesian Econ Min Hartarto announced that movement restrictions in Java and Bali will be extended through Mar 8. Health Min Sadikin added that the gov't is drafting regulations that would allow private companies to carry out Covid-19 vaccinations.
• Jakarta was hit by torrential rains over the weekend, which resulted in severe floods across the capital. Weather conditions forced blocked a number of major roads and entailed several fatalities.
• Fitch wrote in a report that they expect Bank Indonesia to ease monetary policy further and stimulate credit growth this year, following last week's 25bp interest rate cut. They revised their full-year forecast for the policy rate to 3.00% from 3.25%.
• The next bullish target is provided by IDR14,205, which represents the high print of Jan 12. Conversely, a return under the 50-DMA at IDR14,048 would shift focus to Feb 16/Jan 4 lows of IDR13,873/13,865.
• The local docket is virtually empty this week. In lower-tier events, Bank Indonesia holds a briefing on automotive and home loan down payments and lending rates transparency today.