JAKARTA (TheInsiderStories) — Good morning! Bank of Indonesia (BI) will announce its 7-Day Reverse Repurchase Rate (7-DRR rate) today. Some analysts predicted the central bank will hold its rate at 5.75 percent and Rupiah strengthened again.
Investors has anticipated the Bank’s monetary stance seen from the strengthening of the Rupiah and the return of foreign investment in accordance with Domestic Non-Deliverable Forward instrument and foreign inflow to stocks market.
Yesterday, Rupiah started to enter spring, by raising almost 1 percent to 14,755 versus US dollar. After foreign selling-days, it recorded Rp530.77 billion (US$36.10 million) net buy. While, the Jakarta Composite Index increased by 0.39 percent to 5,858.29 compared to previous day.
On Wednesday, most of Asian stocks markets closed in the red zone. HangSeng decreased by 0.54 percent, Shanghai fell 1 percent, and KOSPI that declined 0.15 percent led the downturn. Investors are burdened by world oil prices weakening and China’s retail sales growth slowdown.
The Dow Jones Industrial Average was lowered by 205.99 points or 0.81 percent to 25,080.5 amid fears of the financial sector regarding tightening regulations in the banking industry after the Democratic Party took over the House of Representatives.
While, the Standard & Poor’s 500 index lost 20.6 points or 0.76 percent to 2,701.58 and the Nasdaq Composite fell 64.48 points or 0.9 percent to 7,136.39.
Democratic Party member Maxine Waters, who is expected to become chairman of the DPR’s Financial Services Committee, confirmed that he intends to push strict rules on the sector. He was concerned about the Federal Reserve‘s efforts to reduce capital and liquidity requirements for banks and wanted the central bank to vigorously monitor large banks.
The S&P 500 index also fell on the fifth day in a row with the financial sector down 1.4% and the largest percentage decline in the index. Wall Street cut losses after British Prime Minister Theresa May won support from his senior minister in the draft agreement to leave the European Union, although it resumed a decline in the last half hour of trade.
From domestic side, PT Astra International Tbk (ASII) car sales recorded at 106,050 units until October 2018. The sales increased by 12.3 percent compared to the same period last year. Astra is known holding several car brands like Toyota and Daihatsu, the market leaders, also Isuzu and Peugeot. All booked sales growth.
Meanwhile, Trade Ministry assured that trading swap involving 11 Sukhoi Su-35 fighter jets with $1.14 billion worth from Russia is still ongoing. But Indonesia and Russia haven’t reached an agreement yet.
Both countries is now doing studies to discuss which $570 million-valued commodity that Russia wants from Indonesia. Crude Palm Oil and its derivatives, rubber, and textile were some commodities being offered to Russia. The trade returns mechanism to buy things, is the first time for Indonesia to implement.
Merpati claimed to have secured funding commitment for Rp6.4 trillion from Intra Asia Corpora, a company affiliated with local firm PT Asuransi Intra Asia and PT Cipendawa. The funding will be disbursed in stages and it will be used for debt restructuring and operational capital.
May you have a profitable day!
US$1: Rp 14,700
Written by Linda Silaen and TIS Intelligence Team, Please visit our new website to get more insight on Indonesia’s economy: www.tisintel.com
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