Rupiah Slides to April 2009 Low as Policy Measures Disappoint
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Indonesia’s rupiah fell to the weakest since April 2009 and sovereign bonds dropped on concern policy makers’ steps to boost dollar supply are insufficient to buoy Asia’s second worst-performing currency.
Indonesia will offer tax deductions for export-oriented companies to boost overseas sales and narrow the current-account deficit, which was a record $9.8 billion last quarter, Finance Minister Chatib Basri said Aug. 23. Bank Indonesia announced measures aimed at increasing domestic foreign-currency supply on the same day. Nomura Holdings Inc. is maintaining a bearish view on the rupiah due to the “relatively ineffective policy package,” analysts led by Singapore-based Euben Paracuelles wrote last week.