The Indonesian market was the most positive today but could not contain the might of the USD. The rupiah closed lower at IDR 15,190 per USD on Tuesday. And this is believed to be due to the effect of the Fed, but what results does the Fed bring to the Rupiah market?

On Tuesday, the rupiah exchange rate closed at Rp. 15,190 per US dollar. This means that the USD strengthened 31 points against the Rupiah compared to yesterday's trading. Analysis of the Rupiah also appeared, but most were directly related to Fed policy.

"For trading on Wednesday, the Rupiah will likely be in a very volatile zone. However, the Rupiah could close lower in the range of Rp. 15,180 to Rp. 15,130," said the Director of PT Profit Forexindo Berjangka in a press statement on Tuesday when discussing Forex.

Ibrahim also said that the US dollar's strength was most likely due to market participants waiting on economic data to find out what could push the dollar higher, as the dollar is on top despite the three-week rally that has faded.

The Indonesian Market is Still Watching the Fed's Policy, but the Current Account Surplus Will Make the Rupiah Strengthen?

External sentiments still influence the Rupiah; one of the most fatal is the US dollar which is back in market interest. Such is the statement that many economists believe. 

This is what makes the Rupiah exchange rate against the US dollar often weakened by the Fed. Because the US dollar index increased to 103 to 104, this indicates the strengthening of the US dollar against several major currencies. 

Market speculation is getting more significant because the FED policy is still between increasing its benchmark interest rate or mitigating measures to overcome US inflation. Indonesia's balance of payments (NPI) still recorded a surplus of US$4 billion. 

The performance of the Rupiah and Indonesian markets is directly related to the high global commodity prices. So Indonesian commodities are still maintained reasonably well in the domestic market.

Transactions are continuing to this day and reflect a stagnant foreign exchange supply. Export-import activities between goods and services are related to something that cannot be easily changed. It's just that, since last year, this foreign exchange has continued without stopping.

Indonesia Plans to Narrow 2024 Fiscal Deficit and Working With the Central Bank Stops Interest Rate Increase

Bank Indonesia is said to continue to anticipate the impact of monetary tightening policy in the US by maintaining the stability of the Rupiah exchange rate.

From one by one inflation and domestic economic impact, Bank Indonesia continues to pay attention to various things.

One of the things that gets the most praise is because Bank Indonesia, the central bank, finally stopped the trend of increasing the bug of benchmark rate that has been happening for the last six months. This then has an impact on domestic economic conditions.

Due to global economic uncertainty and its impact on domestic inflation pressure, Bank Indonesia launched the Reverse Repo Rate. The improving economic outlook is still the most targeted so that inflation can be overcome. 

But on this basis, the Rupiah performs exceptionally well compared to other countries. Meanwhile, further news is that Indonesia has lower expenses to bring a budget to a fiscal deficit. Economic growth can also accelerate.

And this keeps Groth in keeping investment momentum strong and avoiding other geopolitical issues. Separately, Indonesia's economy in 2024 will try to expand between 5.3% to 5.7%. 

Investment and household consumption are still the main things. However, revenue must still be met so the economy can run and maintain positive results.

The Rupiah is still one of the most solid currency pairs. One of the things that are interesting to discuss is how the Rupiah moves and what effects it has on the domestic economy. So this is what then makes the Indonesian economy accelerate to a reasonable level.