The rupiah exchange rate weakened against the United States (US) dollar on Wednesday (21/9/2022), until it returned to above Rp. 15,000/US$. However, against the Singapore and Australian dollars, the rupiah was able to strengthen.
According to Refinitiv data, at 12:06 WIB, the rupiah weakened 0.2% against the US dollar at Rp 15,010/US$. At the same time, against the Singapore and Australian dollars, the rupiah was able to strengthen slightly by less than 0.1% to Rp 10,618/SG$ and Rp 10,010/AU$, respectively.
The US dollar is indeed being strong, because the Fed (the central bank of the United States) will announce its monetary policy on Thursday morning Indonesian time.
The Fed is predicted to raise interest rates by 75 basis points, there is even a possibility of 100 basis points.
In addition to the Fed, Bank Indonesia (BI) will also announce the results of the Board of Governors’ Meeting (RDG) tomorrow.
The market consensus compiled by CNBC Indonesia projects that BI will raise its benchmark interest rate this month. Of the 14 institutions involved in forming the consensus, all of them are unanimous in estimating that the MH Thamrin camp will raise the benchmark interest rate.
This made the rupiah able to strengthen against the Singapore and Australian dollars, although slightly.
A total of 12 institutions/institutions estimate that the central bank will raise BI7DRR by 25 basis points (bps) to 4.00% while two institutions/institutions project an increase in BI7DRR by 50 bps to 4.25%.
For the record, BI surprisingly raised the benchmark interest rate by 25 bps to 3.75% in August 2022. The increase was the first since November 2018 or in 44 months.