Indonesia: Rupiah slides to five-month low
November 14, 2016
The Indonesian rupiah (IDR) slid to a five-month low at the start of November as the fallout from the U.S. election hit emerging market assets. The rupiah traded at 13,288 per USD on 11 November, which was 2.1% weaker than the level registered on the same day of last month. Despite the depreciation, the rupiah was 2.3% stronger than the same day last year and has gained 3.6% year-to-date.
The surprise election of controversial candidate Donald Trump has jolted financial markets and hurt emerging market assets. Trump is expected to take a more protectionist stance as President, which could dampen global trade and hurt trade-exposed economies such as Indonesia. Trump has also been very critical of the low interest rate environment in the United States and a potentially tighter U.S. monetary policy has also sparked capital outflows. The recent decline of the rupiah prompted the Central Bank to intervene in the exchange rate market to stem the slide.