Indonesia central bank sees rupiah strengthening in 2025
The central bank also sees the rupiah trading at 15,700 to 16,100 per dollar this year
INDONESIA’S central bank expects the rupiah to strengthen from current levels and trade in a range of 15,300 to 15,700 per dollar in 2025, its governor said on Tuesday (Jun 4).
Governor Perry Warjiyo saw a better outlook for the rupiah due to the prospect of a rate cut by US Federal Reserve next year and returning capital inflow into South-east Asia’s largest economy.
“Next year we see the rupiah strengthening because there is clarity on the Fed rate cut,” he said in a meeting with Parliament to discuss economic assumptions for 2025.
The central bank also sees the rupiah trading at 15,700 to 16,100 per dollar this year.
The rupiah has traded around 16,200 per dollar in recent days, close to four-year lows in April, as emerging market currencies come under pressure from uncertainty about US monetary policy and geopolitical worries.
The central bank also kept its forecast for 2025 economic growth at 4.8 per cent to 5.6 per cent, versus 4.7 per cent to 5.5 per cent this year. Last year, the economy grew 5.05 per cent.
Warjiyo highlighted the importance of spurring domestic consumption and investment to support economic growth.
BI kept its headline inflation target at 1.5 per cent to 3.5 per cent, the same as for 2024. Data earlier this week showed annual headline inflation cooled to 2.84 per cent in May, more than the market had expected. REUTERS
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