The Philippines and Indonesia will probably refrain from monetary tightening to protect their economies from a regional growth slowdown that’s sparked capital outflows and driven down stocks and currencies.
Analysts are lowering their rupiah forecasts by the most in 18 months as Bank Indonesia allows the exchange rate to more accurately reflect worsening exports and an exodus of funds from the nation’s stocks and bonds.
Indonesia’s economic growth probably quickened last quarter as domestic spending withstood the impact of a weakening global recovery that led the central bank to cut interest rates for the first time in more than two years.
Indonesia’s rupiah rose for a second straight day on optimism investors will increase holdings of the nation’s higher-yielding assets as policy makers in the U.S. discuss interest rates and bond purchases. Bonds dropped.