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Thursday, November 06 1997

Indonesian rupiah rebounds against dollar in late trading

REUTER

JAKARTA, November 5: The Indonesian rupiah rebounded against the dollar in a surprise bout of dollar selling in late trading on Wednesday, dealers said.They said the concerted dollar selling by foreign parties pushed the dollar down to a low of 3,270 from 3,340 level before stabilising around 3,275/3,300 at 0900 GMT.

"I heard the orders came mainly from Japanese names. It was brief but it appeared to be effective," one foreign bank dealer said, adding that the tone remained biddish on dollars.

Dealers said swap rates were driven lower as liquidity improved, followed by the rupiah rebound. One US bank dealer said using tight rupiah policy to squeeze the market worried operators because they feared that many more banks could be hurt by high interest rates.

"As we can see in the afternoon, the easing of overnight rates seemed to relieve the market, with the rupiah seen gaining some ground back," the dealer said.

Overnight rupiah fell to 13/15 per cent from 35/40 per cent. Swap rates in both on- and offshores were also lower in the afternoon. In Jakarta, tom/next swap was at 1/2, one-week at 17.5/22.0, one-month at 50/55, two at 95/110, three at 145/180, six at 230/300 and one-year at 450/550 points.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.

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