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Market shouldn't focus on rupiah's drop vs US dollar: Jokowi
[JAKARTA] Indonesian President Joko Widodo said on Tuesday the market should not be fixated on the rupiah currency's exchange rate against the US dollar, given uncertainties over what economic policies US President-elect Donald Trump will follow.
The rupiah has weakened more than 2 per cent since the US election, and on Tuesday was trading at 13,370 to the US dollar.
Jokowi told an economic forum in Jakarta that the rupiah's value against the dollar does not reflect the fundamentals of Southeast Asia's biggest economy.
He said Mr Trump's "America First" policies could bring a jump in the US inflation rate and a rally in the US dollar, making it important to look at the rupiah's exchange rate against those of other big trading partners.
"The America First policy means the dollar would move on its own. America First means America would, relatively, not care about the consequences of its actions on other countries," Jokowi said.
Jokowi said shipments to the United States represent less than 10-11 per cent of Indonesia's total exports, thus business should not over focus on the rupiah-US dollar pairing.
"I think the rupiah against the dollar exchange rate is not an accurate benchmark. The more relevant (benchmark) is the rupiah rate against our trading partners, especially the big ones," he added, citing China, Japan and European Union countries.