Monday, 25 May 2020 | 08:23 WIB

Rupiah Closes Lower After Announcement of Presidential Election

Rupiah Closes Lower After Announcement of Presidential Election (special)

JAKARTA, NETRALNEWS.COM - Rupiah exchange rate at the interbank level in Jakarta is closed on a decline after the announcement of the results of the national election recapitulation by the Indonesia General Election Commission (KPU).

The rupiah weakened by 25 points or 0.17 percent to IDR 14,480 per US dollar, as compared to the previous position of IDR14,455 per dollar.

Ibrahim Assuaibi, President Director of Garuda Berjangka, said in Jakarta on Tuesday said that although the KPU had determined the results of the Presidential Election, the political drama had not yet ended. The National Winning Body (BPN) of Prabowo-Sandiaga has rejected the results of the vote recapitulation. It also considered that the presidential election was full of fraud, so the legality of the results were questionable.

"Therefore, the mass protest action on May 22 is still scheduled to take place. Security risks are still quite high, so that might be a concern of investors," Ibrahim said.

In addition, in relation to the April 2019 trade balance deficit which reached US $ 2.5 billion, market participants still have not moved on. While in quarter I-2019, the current account deficit was 2.6 percent of Gross Domestic Product (GDP), worsening than the same period of the previous year, which was 2.01 percent of GDP.

With an all-out trade balance in April and possibly continuing in May due to high imports anticipating the need for the fasting month of Ramadan and Eid al-Fitr 1440 Hijri, the prospect of the current transaction in the second quarter of 2019 is somewhat bleak.

"This means that the long-term supply of foreign exchange from exports and imports of goods and services is still sluggish, so that the rupiah depends on capital flows in the financial markets or hot money that can go in and out of one eye. It is very vulnerable," Ibrahim said.

The rupiah opened lower in the morning at IDR 14,463 per dpllar. Throughout the day, the rupiah moves in the range of IDR 14,463 to IDR 14,480 per dollar.

Meanwhile, the middle rate of Bank Indonesia (BI) on Tuesday showed the rupiah strengthened to IDR 14,462 per dollar from the previous position of IDR 14,478 dollar.