Rupiah Forecast to Weaken Amid Rising Oil Prices

Bank Mandiri's Office of the Chief Economist forecasts that the Indonesian rupiah exchange rate will likely weaken in today's trading. The predicted range is between Rp17,590 and Rp17,685 per US dollar.

The tendency for the rupiah to depreciate is influenced by emerging pressure from global oil prices, U.S. Treasury debt yields, and expectations of a Federal Reserve interest rate hike this week. According to Bank Mandiri Head Economist Andry Asmoro, 'However, the relatively stable DXY and positive foreign capital inflows in the bond market may limit the extent of rupiah depreciation.'

Oil prices rose by about 3 percent to $107 per barrel on Monday morning after falling 2.81 percent to $104.6 per barrel on Friday. The increase is triggered by new attacks on Saudi Arabian energy infrastructure and ships in the Gulf, raising concerns about global oil supply.