Headquarters of Federal Reserves - Photo by the Central Bank Office

JAKARTA (TheInsiderStories) – Good Morning! Today, United States’ Federal Open Market Committee (FOMC) its expecting to cut the Federal Reserves Fund rate (FFR) followed President Donald Trump statement yesterday. Some analysts rated, its third rate cut represented the end of its policy loosening.

Last month, the central bank cut the FFR for third time since 2018 to help the economy. The committee lowered the benchmark rate to 1.5-1.75 percent, or slice by 25 basis points.

Yesterday, Trump threatened to raise import tariffs on Chinese products if no agreement is reached with Beijing to end the trade war. Speaking at a cabinet meeting at the White House, he said the two countries must move together and must make a deal that “I like.”

Washington and Beijing have been caught in waves of reciprocating tariff increases that have shaken world financial markets. In addition, the tariff war also threatened to drag global economic growth to the lowest level since the 2007 – 2008 financial crisis.

From Indonesia, energy and mineral resources (EMR) minister Arifin Tasrif has signed the implementation of a mixture of 30 percent biodiesel in diesel oil (B30) on Nov. 15. A legal umbrella for this policy contained in EMR ministerial decree No. 227 K/10/MEM/2019.

The ministry targeting the preparation for the implementation of B30 in early 2020. Its expecting with the implementation of the new policy would be give an additional foreign exchange savings from the reduction of diesel imports by around 10 percent in addition to the previous program B20.

On Tuesday, Indonesian Rupiah closed down 0.085 percent to 14,091 against the US Dollar and the Jakarta Composite Index (JCI) Today, the domestic exchange rate is predicted move in the range 14,062 to 14,115 versus the American Dollar and the stock index between 6,125 – 6,210.

The reasoned, Rupiah and the composite index still in the negative zones caused Chinese felt pessimistic about agreeing to the first phase of the agreement with the US. This situation showed that there was still a great risk to global economic growth and the development of trade between the two countries remained elusive.

The observes said, the investors also to observe Trump and the Fed chairman Jerome Powell, amid the president’ repeated criticism of the central bank, which is considered insufficient in reducing interest rates.

From domestic, the decision of Indonesia Deposit Insurance Corporation to cut the guarantee interest rates by 25 bps to 6.25 percent for Rupiah deposits at commercial banks have also become a driving force for the local currency.

With the various development, the analysts recommended these stocks to be watch for today. The shares are PT Bank Rakyat Indonesia Tbk (IDX: BBRI), PT Bank Negara Indonesia Tbk (IDX: BBNI), PT Bank Permata Tbk (IDX: BNLI), PT Telkom Indonesia Tbk (IDX: TLKM), PT Perusahaan Gas Negara Tbk (IDX: PGAS), and PT Jasa Marga Tbk (IDX: JSMR).

Then, PT Astra International (IDX: ASII), PT AKR Corporindo Tbk (IDX: AKRA), PT HM Sampoerna Tbk (IDX: HMSP), PT Vale Indonesia Tbk (IDX: INCO), PT Japfa Comfeed Indonesia Tbk (IDX: JPFA), PT Semen Indonesia Tbk (IDX: SMGR), and PT Unilever Indonesia Tbk (IDX: UNVR).

May you have a profitable day!

Written by Linda Silaen and TIS Intelligence Team, Please Read Our Insight to Get More information about Indonesia