BENGALURU: Indonesia’s rupiah fell to a near five-month low on Monday as most emerging Asian currencies weakened against a firming dollar, while regional equities were mixed even as benchmarks in Taiwan and South Korea hit fresh record highs.
In India, the rupee and stocks fell 0.1 percent each after the US introduced a new fee structure for fresh H-1B worker visas, raising concerns about the potential impact on the country’s IT sector.
On the other hand, the Indonesian rupiah weakened as much as 0.3 percent to 16,635 per dollar, its lowest level since April 30.
Indonesian central bank Governor Perry Warjiyo said the rupiah was still under control, and that the bank would maintain its market interventions to stabilise the currency.
Bank Indonesia’s surprise rate cut last week had raised concerns that the bank was bowing to pressure from President Prabowo Subianto to prioritise growth.
That, along with Southeast Asia’s largest economy facing social unrest, and fiscal worries after the abrupt sacking of a reputable finance minister, has led the rupiah to become the worst-performing regional currency this year with a 3 percent drop.
Poon Panichpibool, Krung Thai Bank market strategist, said that the rupiah could continue to stay under pressure if the greenback rises further, but more foreign inflows into the Indonesian bonds, which have an attractive yield, could cap the decline.
Other regional currencies were also on the back foot with the MSCI index of emerging market currencies slipping for a third consecutive session.
