The rupee exchange rate today, Thursday (4/8), is predicted to weaken against the US dollar in line with rising tensions in relations between the United States (US) and China following the visit of the Speaker of the US House of Representatives. , Nancy Pelosi, to Taiwan.
gather bloombergIn the spot market, the rupee opened with a gain of eight points at Rs 14,904 per US dollar this morning. However, the rupee weakened at 09.15 WIB to Rp. 14,918. It surpassed yesterday’s close at Rp 14,912 per dollar.
Other Asian currencies strengthened against the US dollar this morning. South Korean gained 0.11%, with Taiwan Dollar and Singapore Dollar gaining 0.03%, Japanese Yen and Malaysian Ringgit 0.04%, Thai Baht and Chinese Yuan 0.08%, Philippine Peso 0.02%. On the other hand, the rupee weakened by 0.57% this morning along with the Indian rupee.
Bank Mandiri analyst Reni Eka Putri predicts that the rupee will continue to weaken today due to several external sentiments ranging from the Fed’s interest rate hike to tensions in US-China relations. He estimates that the rupee will move in the range of Rs 14,880-14,965 per dollar.
In his research, Rainey said on Thursday (4/8), “Investors responded sharply to statements from top Fed officials, noting that US inflation remains high, even though they fear the risk of slowing economic growth.” had to face it.” ,
Several Fed officials commented on the possibility of the Fed continuing with rate hikes. The world’s leading central bank has increased interest rates by 225 bps from March 2022.
In addition to sentiment on the Fed’s interest rate hike, the market is also anticipating a further escalation in tensions between the US and China. “The market volatility has also increased due to the geopolitical conflict between China and Taiwan,” Rennie said.
US House of Representatives Speaker Nancy Pelosi visited Taiwan on Wednesday (3/8). The US officials’ visit then faced strong opposition from China, which claimed Taiwan was part of its country.
China has shown anger by increasing military activity in the seas around Taiwan, summoning the US ambassador to Beijing and halting some agricultural imports from Taiwan.
Domestically, market players will look forward to the release of data on economic growth and foreign exchange reserves in the second quarter of 2022. Rainey estimates that economic growth could increase by 5.15% annually.
In addition to domestic economic data, market participants will also anticipate the release of US employment sector data as a factor in the Fed’s future policy considerations. The US unemployment rate is projected to remain stable at 3.6% in July 2022.
DCFX analyst Lukman Leong also sees that the rupee will remain under pressure and move in the range of Rp 14,850-Rp 14,960 per US dollar. The pressure on the rupee mainly came from several comments by Fed officials about the possibility of aggressive interest rate hikes.
“However, the risk sentiment in the stock exchange favors riskier currencies such as the rupee,” Lukman said in his research.
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