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Indonesian economy looks more fragile as Fed turns hawkish

Stocks down, rupiah at its lowest in 3 months as possibility of higher US rates rattles investors

The key to keeping foreigners invested is to ensure the rupiah stays stable. But if the Fed raises rates faster than expected and the dollar takes off, the rupiah may turn volatile again.


FOR all the talk of Indonesia's impressive reform momentum and unusually stable markets so far this year, investors have been reminded harshly that the country still remains highly vulnerable to the risks from higher US interest rates.

Global investors, many of whom had...

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