Indonesia’s rupiah and stocks fell for a fourth day after yesterday’s surprise interest-rate rise fueled speculation current-account data today will show little improvement from the second quarter’s record deficit.
President Susilo Bambang Yudhoyono made progress on his bid to appoint Indonesia Finance Minister Agus Martowardojo the next central bank chief as a parliamentary panel agreed to put the candidate through a fit-and-proper test.
Indonesia’s plan for guidelines on acquiring land for infrastructure projects and a boost to the nation’s credit rating augur improved prospects for investment in the world’s fourth-most populous country.
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.
Indonesia’s inflation rate climbed for a third month in June as the end of the harvest season crimped food supplies, an increase that may not be sufficient to trigger an interest-rate increase next week.
Indonesian lawmakers yesterday approved Finance Minister Agus Martowardojo to become the next central bank governor after he said his priorities would be a stable exchange rate and keeping inflation low.
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.