USD/IDR climbed to a record 18,272 as political uncertainty in Indonesia and a hawkish Federal Reserve outlook drive the pair higher, with markets now pricing an 87% chance of a December rate hike.
The pair hit a fresh record high of 18,272 as Indonesia's MSCI index concerns, the Vice President's resignation raising coalition-split risk, and a hawkish Fed after hot US CPI all push the Rupiah lower. Multiple independent drivers reinforce the same direction, though the RSI near overbought (66.99) hints at a possible short-term pause.
Hotter-than-expected US CPI and hawkish Fed commentary (Waller backing a quarter- or even half-point December hike, Goolsbee calling services inflation 'not coming down') lift the dollar, with markets pricing ~87% odds of a December hike. This dollar strength is a key driver of the USD/IDR record high.
The Indonesian Rupiah hit a record low of 18,272 against the US Dollar amid political instability following Vice President Gibran Rakabuming Raka's resignation. Simultaneously, the US Dollar surged as markets priced in an 87% probability of a December Fed rate hike following hotter-than-expected CPI data.
Renewed MSCI index concerns, political uncertainty after the Vice President's resignation, and a hawkish Fed following hot US CPI data are all pushing the pair to record highs around 18,260-18,272.
The near-term bias stays constructive as long as the pair holds above EMA supports near 18,147.87 and 18,010.74, though the RSI at 66.99 near overbought levels hints at a possible short-term pause.
Markets price around an 87% probability of a December rate hike, with a nearly 13% chance of a larger 50 basis point increase, following hotter-than-expected US CPI inflation data.
Hotter CPI and hawkish Fed speakers, including Waller and Goolsbee, raise expectations of tighter policy, which attracts flows into the dollar and lifts USD/IDR.