US Dollar Weakens while IHSG Bucks The Regional Trend

RRI.CO.ID, Jakarta - The Jakarta Composite Index (IHSG) stayed consistently in the green zone throughout the trading session. It traded between 6,636 and 6,696 before closing 1.01 percent higher at 6,686.44.

This upward trend defies market weakness as the IHSG strengthened despite declining Asian stock markets. Major stocks like BUMI, BBRI, BBCA, TLKM, Bank Mandiri, and various energy sector shares contributed to this rally.

Asian stock markets weakened due to rising global crude oil prices hitting $98.60 per barrel. Brent crude nearly reached $100 per barrel amid escalating conflicts in the Middle East.

Such tensions will make it difficult for stock markets to escape downward pressure. Rising crude oil prices will inevitably increase cost pressures on listed companies across the exchange.

Meanwhile, the Rupiah was strengthened throughout the entire trading session. The currency closed at 17,625 against the US Dollar amid muted external sentiments.

China's recent trade data release was met with a largely negative response from Asian stock markets. However, the situation allowed Asian currencies to move stronger relative to the US Dollar.

The US Dollar Index dropped below 99, triggering the dollar's weakness against several Asian currencies. The United States budget deficit remains a central focus for market participants.

The US Treasury Department's plan to buy back government bonds has sparked new market speculations. Investors suspect the US Central Bank might perform similar actions, often known as quantitative easing.

On the other hand, global gold prices weakened to trade at $4,400 per troy ounce. This price is equivalent to roughly 2.5 million Rupiah per gram.

Gold prices are currently overshadowed by the possibility of benchmark interest rate hikes by the Federal Reserve. This potential rate hike aligns with recently improving employment data in the United States.

Writer: Gunawan Benjamin (Economist, UISU)