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Jakarta, CNBC Indonesia – The exchange rate of the rupee against the US dollar continues to strengthen until 9:40 am today (on 29/11/2018) successfully reached the level of 14,385 rupees / US $ . The rupee has rallied by almost 1% or exactly 0.96% compared to the previous day's close at 14,552 RUS / USD.
Bank Indonesia (BI) said it would continue to provide space for strengthening the rupee.
"BI will continue to provide space for the rupee to continue to grow in line with the market mechanism," CNBC Indonesia, head of the Bank of Indonesia (BI) Monetary Management Department, Nanang Hendarsah, told reporters.
Nanang acknowledged that the strengthening of the rupee had come after a statement by Fed Chairman Jerome Powell, who had made a "dovish" statement.
"The DXY index or Dollar Index is strongly weakened in free fall in response to Powell's dovish statements," Nanang said.
Powell said that the benchmark interest rate was very close to a neutral stance, which did not support economic growth or curbed it. This comment has changed a lot compared to the beginning of October, when Mr Powell said that the benchmark interest rate was far from being neutral.
"The benchmark interest rate remains low by historical standards and is slightly below the range of neutral estimates," Powell said, citing Reuters.
Market participants read Powell started a little dovish. In other words, it is not impossible for the Fed to reduce the interest rate benchmark rate because it is almost enough.
This rather accommodative attitude is also reflected in the statement that the Fed will pay close attention to the data, even if economic growth is solid and inflation and unemployment figures have improved.
"We all know that the situations may be different from the forecasts." The gradual increase in interest rates aims to balance the risk, Powell continued.
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