FXTM Research Analyst Lukman Otunuga expects the rupiah to weaken this week. It could happen if the dollar continues to strengthen.
"The rupiah is threatened to continue to weaken this week, due to global trade problems that erode the appetite in risky currencies," Lukman said in a written statement on Wednesday, June 20, 2018.
Lukman sees market players are monitoring whether the current dollar appreciation can make the rupiah move towards Rp 13,950. According to Lukman, the rupiah is likely to weaken this week if the Dollar continues to strengthen and risk sentiment worsens, due to global trade situation.
According to Lukman the increasingly tense trade situation between the United States and China adds to market jitters and exacerbates the situation for emerging markets.
The prospect of rising US interest rates could trigger concerns about capital outflows from emerging markets, but global trade issues are also a big risk, "Lukman said.
Lukman said the trade tension could lead to concerns about the deterioration of global protectionism that has a negative impact on the growth of market growth. "Therefore, currencies and emerging market stocks may weaken further," Lukman said.
In the official website of Bank Indonesia, the Jakarta Interbank Spot Dollar Rate or JISDOR recorded the rupiah against the US dollar at Rp 13,902 at the close of Friday, June 8, 2018. The lift showed a 34 point weakening from the previous value of Rp 13,868 at the close of Thursday, June 7, 2018.
Binaartha Securitas analyst Reza Priyambada estimates the rupiah will weaken today. According to Reza, the rupiah will move with a support range of Rp 13,930 and resistance Rp 13,914.
Reza said after the sentiment of the G-7 meeting, the rupiah was faced with a potential sentiment for the return of trade wars between the US and China.
"After the US plans to impose a 10 percent tariff on Chinese imported goods worth US $ 200 billion as a continuation of the imposition of Chinese imported goods worth US $ 50 billion," Reza Priyambada said when contacted.