FX.co ★ Rupiah Softens to Near 16,690

The Indonesian rupiah fell to approximately 16,690 against the dollar on Wednesday, erasing gains from the previous session as investors grew cautious in anticipation of next week’s final monetary policy announcement of the year. In November, Bank Indonesia maintained its benchmark interest rate at 4.75% for the second month in a row, following a total reduction of 150 basis points since September 2024. The bank indicated that there could still be room for further easing to bolster economic growth, as noted by Governor Perry Warjiyo, who highlighted that growth remains below its potential. Recent data showing a significant rise in October retail sales, the highest in three months, failed to boost market sentiment. Investors were more concerned about rising inflationary risks associated with logistical disruptions due to severe flooding and landslides in Sumatra in late November. On the international front, the dollar index hovered around 99.2 as markets awaited the Federal Reserve’s rate decision later today, with the expectation of a 25 basis point cut, although potential hawkish guidance could prevent significant downward pressure on the greenback.