Guessing Rupiah fate in the Trump First Year

President of the United States (US) Donald Trump and the Indonesian currency which is rupiah have relevance. What will be done by Trump is able to make the rupiah up or down, even in the adjacent.

detik.com

2017 period is the first period of Trump will be very critical for the rupiah. Trump is predicted will bring variety of policies, where the effect was immediate in global financial markets, and to Indonesia.

One of them is, to push the US economy to grow faster, which is 4% per year. Yet now the realization that US economic growth was only about 1.6%. The strategy planned is cuts in tax rates, and withdraw US citizens money that had been kept in other countries, or the so-called repatriation.

Strategies to reduce state revenues by cutting taxes, it was greeted with an aggressive spending. This will cause the budget deficit to swell, and the end is additional debt. The US government should be vigilant, because now the ratio of tax to Gross Domestic Product (GDP) has exceeded 100%. The latest data of US government debt is $ 19 trillion.

Those Conditions are very affected investor expectations, particularly against the US benchmark rate or the Fed Funds Rate. The economy is growing rapidly in tandem with high inflation, means the increase in the benchmark rate could also be faster than expected.

"Rupiah, still relevant directives US interest rates as in the past two years. It is very sensitive to the statement of Janet Yellen," said Chief Economist of PT Bank Permata Tbk Josua Pardede to detikFinance, Sunday (01/29/2017).

Josua estimates, the rupiah against the US dollar could be weaker than expected by the government and Indonesia Bank (BI). The government assumes the US dollar throughout 2017 to Rp 13,300. Josua see any possibility to get to Rp 13,500.

"On the global condition, the rupiah may weaken to Rp 13300-13500," said Josua.

One that can withstand the weakening rupiah of this uncertainty is the strengthening of the global economy. Josua see any significant economic progress in the past two years, prompting investors to enter into the country.

Economic growth is projected to be higher than the government's assumption (5.1%), which are 5.2 to 5.3%. Inflation will also be slightly higher than the previous year, which is above 4%. While the current account deficit, although there is an increase, still moving at the boundary control.

"It is hoped the data of the Indonesian economy speaks to investors," He ended.

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