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  • Rupiah remains on the back foot amid expectations of another downbeat data.
  • Overall USD strength, dovish BI again propels the USD/IDR pair beyond key SMAs.

With geopolitical tension at Indonesia adding weakness to the Indonesian Rupiah (IDR), USD/IDR follows its short-term rising formation while taking the bids to 14,180 during early Tuesday.

Indonesian President Joko Vidodo is under immense pressure at home as large protests take over the nation to resist legislation aiming to reduce corruption and personal freedom.

Indonesian economics have recently been taking the toll on the domestic currency with Consumer Confidence and Bank Indonesia’s (BI) rate cut being the latest to propel the USD/IDR pair.

On the other hand, the US Dollar (USD) reaps benefits of its safe-haven appeal despite failing to publish upbeat statistics and growing calls for the US President Donald Trump’s impeachment.

Investors now await September month inflation data amid upbeat market consensus of a yearly figure increase to 3.54% from 3.49% whereas MoM reading could decline to 0.16% versus 0.12% prior. Further, Core Inflation (YoY) could soften to 3.17% from 3.30%.

TD Securities’ latest report follows the suit while saying, “We expect CPI to rise by 3.68% y/y in September from 3.49% y/y in the previous month. A lower base in September last year points to a higher y/y CPI reading even as the monthly increase in price pressures is likely to remain soft. Both food and transportation costs are likely to remain benign while education costs could register another outsized gain over the month.”

Technical Analysis

Unless providing a sustained downside below rising trend-line since September 12, prices are less likely to revisit 14,000 round-figure, which in turn portrays pair’s strength to challenge the previous month high nearing 14,280. However, multiple resistances around 14,340/50 could challenge buyers afterward.