The Indonesian rupiah depreciated against the US dollar on Thursday, January 16, 2025, closing down 50 points at 16,376 after a decline of 70 points earlier in the day. The previous closing was at 16,325.
Market sentiment was influenced by US economic data, particularly a slightly lower-than-expected Consumer Price Index (CPI) for December. Analysts noted that the core CPI fell short of expectations, raising speculation that the Federal Reserve might consider interest rate cuts this year.
According to Ibrahim Assuaibi, Director of PT Laba Forexindo Berjangka, the rupiah is expected to remain volatile, trading between Rp. 16,360 and Rp. 16,430 in the coming days. He indicated that the Fed is projected to implement two rate cuts in 2025, half of the reductions seen in 2024.
Additionally, the return of Donald Trump as US President next week is anticipated to influence economic policies, potentially impacting growth and price pressures. Ibrahim cautioned that the Fed would be cautious in proceeding with rate cuts until there is clear evidence of declining inflation.
This week, attention will also be on key economic indicators from China, with GDP figures for 2024 set to be released on Friday, alongside industrial production and retail sales data.