The riots that occurred on May 22 in Jakarta resulted in a negative response to the rupiah exchange rate.
What is the current rupiah exchange rate?
This morning, the US dollar showed Rp. 14,528. The riots that have been smelled since Monday (20/5) resulted in the US dollar exchange rate reaching Rp. 14,400. Then, on Tuesday (5/21), yesterday, the exchange rate was at the level of Rp. 14,465.
The change in the US dollar against the rupiah was quite stable at the level of Rp. 14,400 when viewed from the beginning of the week. The rupiah looks depressed against some of the world’s major currencies. Like the British pound, the Philippine peso, and the euro which cornered the rupiah the most this morning.
What are the main causes of weakening rupiah?
Reporting from thejakartapost.com, the riots happened after Indonesian Election Supervisory Agency Office declared that incumbent President Joko “Jokowi” Widodo is the winner of the presidential election. Many Indonesian people could not accept the result of the election. Thus, most of them protested in front of the Election Supervisory Agency Office.
Jemmy Paul, Asset management firm Sucorinvest Asset Management executive chairman said that many investors felt uneasy over the effect of the declaration of the presidential election result. He said that the security and political precariousness will cloud exchanging the coming days and next week.
Because of these riots, there were 6 people reportedly death while 200 others left injured.
Is there any solution?
Ibrahim, a PT Garuda Berjangka president director compared the conditions of the May 22 riots which inversely proportional to the 2014 election. When the Indonesian Election Supervisory Agency Office stated that Jokowi-Jusuf Kalla won, the rupiah exchange rate immediately skyrocketed compared to this morning.
If this chaos continues and there are no bright spots, it is probable if the US dollar can also break to the level of IDR 15,000 on a daily basis. This can be overcome if there are parties, especially from presidential candidate 02 (Prabowo-Sandiaga) who drown out mass action and open a path of peace.