RRI.CO.ID, Jakarta - High inflation threats continue as crude oil prices keep rising globally. Brent crude is currently trading higher at around $97 per barrel. This ongoing price surge is mainly triggered by exchanges of strikes in the Strait of Hormuz.
Meanwhile, the reopening of Soekarno-Hatta Airport has brought positive sentiment to the financial market. This optimism comes despite lingering fears of further eruptions from Mount Anak Krakatau.
The Jakarta Composite Index (IHSG) strengthened to 6,639 during the opening trading session. Simultaneously, the Rupiah appreciated to trade at 17,625 against the US Dollar.
Overall domestic market sentiment remains favorable for supporting financial sector performance. However, investors are also closely watching important economic data releases this week. Locally, the upcoming releases of the consumer confidence index and retail sales data will heavily influence market sentiment.
Globally, inflation data from the US and China will be the key factor for the financial sector. Rising global crude oil prices mean future inflationary pressures are very likely to increase.
If US and Chinese inflation data exceed market expectations, financial markets could quickly fall back into the red. Over the next week, the market still faces a higher risk of a correction than a rally.
Today, the IHSG is projected to trade in a limited range between 6,630 and 6,670. Meanwhile, the Rupiah is expected to move between 17,600 and 17,670.
Separately, global gold prices managed to strengthen despite the upward pressure from crude oil prices. Gold is currently trading around $4,427 per troy ounce, or roughly 2.52 million Rupiah per gram.
Writer: Gunawan Benjamin (Economist, UISU)
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