Rupiah Slips Ahead Of Bank Indonesia Rate Decision

Spot USD/IDR continues to test the psychological IDR15,000 barrier, which has provided the upper limit to price action over the past two weeks. The rate last changes hands +11 figs at IDR14,999, with topside technical focus falling on Jul 6 cycle high of IDR15,024. Meanwhile, the initial layer of support is provided by Jul 27/21 lows of IDR14,794/14,784.

• USD/IDR 1-month NDF last +13 figs at IDR15,047. A break above Jul 15 high of IDR15,190 would reaffirm that the underlying bullish bias remains. Bears need a fall through the 50-DMA/Jun 27 low at IDR14,792/14,788 to get some reprieve.
• MYR/IDR last deals at IDR3,367, little changed on the day, with bearish focus falling on the nearby Jun 27 low of IDR3,358. Below there opens the broken neckline of a double bottom pattern, which intersects with the 50-DMA around IDR3,350. Bulls look for a rebound above the IDR3,400 mark, which capped gains on the previous upswing.
• SGD/IDR last seen at IDR10,773, up 11 figs on the day. Further gains past yesterday's high of IDR10,778 would encourage bulls to target Jun 30, 2021 high of IDR10,821. Bears keep an eye on the 50-DMA/Jul 12 low at IDR10,643/10,636.
• 22 out of 36 economists in a Bloomberg survey expect Bank Indonesia to keep the 7-Day Reverse Repo Rate unchanged but the rest have pencilled in a 25bp hike. We think the Bank is more likely to stand pat this time (see our preview), as closely watched core inflation remains below the mid-point of the target range. That said, a pre-emptive rate rise cannot be ruled out and remains a hawkish risk.