USD/IDR trades at 18,060 as Indonesia's Q3 GDP growth of 5.47% and lower crude oil prices bolster the Rupiah, despite rising expectations for a December Fed rate hike.
USD/IDR has fallen for a second straight day to around 18,060 as Indonesia's Q3 GDP beat consensus at 5.47% yoy versus 5.2% expected, Bank Indonesia intervened in FX markets and October reserves rose slightly. Falling crude prices also ease the import bill for this net oil importer. Fed hawkishness limits further dollar weakness but does not reverse the local drivers.
Safe-haven demand for the Dollar is waning on speculation of a diplomatic breakthrough between Washington and Tehran, with Trump saying further strikes on Iran appear unnecessary. However, strong NFP data and hawkish Fed comments lifted the December hike probability to 84%, cushioning the downside, so the bearish tilt is modest.
Crude oil has fallen to its lowest levels since August as speculation grows over a diplomatic breakthrough between Washington and Tehran, with Trump saying further strikes on Iran appear unnecessary. An easing of Middle East conflict risk and fading inflation concerns point to continued downward pressure on oil prices.
The Indonesian Rupiah strengthened for a second consecutive day, pushing USD/IDR down to 18,060. The move follows a robust Q3 GDP print of 5.47% yoy, which outperformed the 5.2% consensus, alongside Bank Indonesia's market intervention and lower crude oil prices. While the US Dollar faces pressure from easing US-Iran tensions, hawkish Fed signals keep a floor under the greenback, with December rate-hike odds climbing to 84%.
A Q3 GDP beat (5.47% yoy vs 5.2% expected), Bank Indonesia FX intervention, higher October reserves and cheaper crude oil imports are all supporting the Rupiah, pushing USD/IDR down to around 18,060.
Hawkish Fed signals, with the probability of a December rate hike up to 84%, cushion the Dollar's downside and could limit or reverse the pair's decline.
Yes, modestly. Speculation over a US-Iran diplomatic breakthrough is eroding safe-haven demand, though expectations of a possible December Fed rate hike limit the decline.
Growing speculation of a diplomatic breakthrough between Washington and Tehran, reinforced by Trump's comments that further strikes on Iran appear unnecessary, has eased supply-risk fears, pushing crude to its lowest levels since August.