The negative sentiments, shown in the trade war between the U.S and China, caused IDR to weaken. (Image via Vibiznews)
Trump's statement presses IDR to Rp14.030/USDOn Monday’s foreign exchange (forex) spot market opening, the Indonesian Rupiah (IDR) is seen at Rp14,030 against the U.S Dollar (USD). The rate fell by 16 points or 0.11 percent compared to the rate on Friday’s closing at Rp14,014/USD. For today, the IDR is moving Rp13,980 - Rp14,050/USD.
This morning, the majority of Asian currencies withered against the USD. South Korean Won (KRW) weakened by 0.20 percent, Malaysian Ringgit (MYR) by 0.11 percent, and Singaporean Dollar (SGD) by 0.07 percent. Meanwhile, Thai Baht (THB) weakened by 0.03 percent, the Hong Kong Dollar (HKD) by 0.02 percent, and Turkish Lira (TRY) by 0,01 percent.
Japanese Yen (JPY) is the only currency that strengthened against USD by 0.03 percent.
The majority of developed countries’ currencies strengthened against the USD. Great Britain Pound sterling (GBP) strengthened by 0.15 percent, European Union Euro (EUR) by 0.03 percent, and Canadian Dollar (CAD) by 0.01 percent.
Only Australian Dollar (AUD) that weakened by 0.08 percent.
Indonesian forex experts explained that the IDR’s weakening was due to two factors: the hike in the U.S bond yields rate and the negative sentiments showed in the trade war between the U.S and China.
The content of the “Phase One” agreement between the two warring countries is not clear yet, and it leads to speculations and expectations in the market.
The President of U.S, Donald Trump, and the President of China, Xi Jinping, stated that they might need more time to discuss the “Phase One” agreement. The agreement might have to wait until December.
Trump answered the statement made by China’s Ministry of Trade regarding the erasing of tariffs. Trump stated that Washington had not agreed to the demand.
For forex experts, Trump’s statement reflected the length and smoothness of the trade negotiation between the U.S and China, and they showed bad signs.