Rupiah Drops Most in a Week on US Data, Exports; Bonds Steady
Indonesia’s rupiah declined the most in a week after industrial activity in the US unexpectedly shrank in June, spurring concern Asia’s exports may slow.
The US manufacturing index for June showed a contraction for the first time in nearly three years, the Institute for Supply Management said yesterday. Indonesia recorded its second consecutive trade deficit in May at $486 million, as exports fell 8.5 percent from a year earlier, the statistics bureau said yesterday. Government bonds were little changed.
“The manufacturing data cast doubt on the economic recovery,” said Klara Pramesti, a Jakarta-based research analyst in the treasury division at Bank Negara Indonesia. “The global economy is tending to worsen and Indonesia is part of that wider picture.”
The rupiah weakened 0.5 percent to 9,425 per dollar as of 9:08 a.m. in Jakarta, the biggest drop since June 26, according to prices from local banks compiled by Bloomberg. One-month implied volatility, which measures exchange-rate swings used to price options, held at 8.5 percent today.
The yield on the government’s benchmark 10-year bonds was little changed at 6.08 percent, the lowest level since May 7, according to data compiled by Bloomberg.