The Indonesian rupiah opened weaker at 17,645 per US dollar on Tuesday, 8 September, slipping 0.3 percent or 5 points as rising global crude oil prices weighed on sentiment.
Early trading and energy pressure
The domestic currency trimmed those early losses within minutes, trading at 17,632 per US dollar by 09:12 local time for a gain of 0.05 percent or 8 points. Oil prices remained elevated as Brent crude traded in the $97 a barrel range, while West Texas Intermediate approached $93 a barrel.
Crude pushed higher following escalating tensions between the United States and Iran, which raised fears of potential energy supply disruptions across the Middle East. Lukman Leong, an analyst at Doo Financial, noted that although the rupiah might find support from a correcting US dollar index, climbing global crude oil prices continue to weigh on the currency.
Consolidation outlook and previous session
Leong projected the rupiah to fluctuate between 17,600 and 17,700 per US dollar during Tuesday trading. The market lacked major data releases.
“The rupiah is expected to consolidate against the US dollar amid the absence of key economic data from both domestic and external sources today,” Leong said. The calm calendar kept trading tight.
On the previous trading day, the rupiah closed at 17,640 per US dollar, finishing up by 2 points against 17,642 per US dollar despite having suffered an intraday decline of 25 points during that session.
Related: Rupiah strengthens to Rp17,705 as dollar index falls
