Rupiah Snaps Two-Day Decline Before Interest-Rate Decision

By webadmin on 11:49 am Aug 09, 2012
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Indonesia’s rupiah rose for the first time in three days ahead of a central bank meeting at which economists predict interest rates will be left at a record low.    

Bank Indonesia will hold its benchmark reference rate at 5.75 percent today, according to 25 of 26 economists in a Bloomberg News survey. Southeast Asia’s largest economy grew 6.37 percent in the second quarter from a year earlier, more than the 6.10 percent predicted in a Bloomberg survey, official data showed Aug. 6.    

“The expectation is that interest rates will be the same because the gross domestic product data was very good,” said Dave Hartono, a Jakarta-based foreign-exchange trader at Bank ICBC Indonesia.    

The rupiah climbed 0.1 percent to 9,486 per dollar as of 9:37 a.m. in Jakarta, according to prices from local banks compiled by Bloomberg. The currency has dropped 0.5 percent this month. One-month implied volatility, which measures exchange- rate swings used to price options, was steady at 7.50 percent.    

The yield on the government’s benchmark 10-year notes held at 5.74 percent, data compiled by Bloomberg show. The finance ministry plans to raise 6 trillion rupiah ($633 million) at an auction of bonds and bills today.

Bloomberg