- USD/IDR retreat from intraday high on upbeat Indonesia Q4 GDP.
- Indonesia GDP rose 0.36% QoQ in Q4 versus 0.33% expected and 1.81% prior.
- China-linked risk aversion, Fed concerns put a floor under the USD/IDR prices.
USD/IDR fades the week-start rebound as it drops to $15,050 after Indonesia reported the fourth quarter (Q4) Gross Domestic Product (GDP) data. It’s worth noting, however, that the risk-off mood challenges the Indonesian Rupiah (IDR) buyers.
Indonesia’s Q4 GDP marked 0.36% QoQ and 5.01% YoY growth during Q4. In doing so, the growth figures are better than the 0.33% and 4.84% market forecasts but stayed below the 1.81% and 5.72% previous releases.
“Southeast Asia's largest economy expanded 5.31% in 2022, Statistics Indonesia data showed, its best annual growth rate in nine years,” said Reuters following the Indonesia GDP release.
Talking about the risks, The weekend headlines suggesting the US military fighter jet shot down a suspected Chinese spy balloon off the coast of South Carolina join the recently hawkish concerns surrounding the US Federal Reserve (Fed) to weigh on sentiment.
Following the US shooting of the China balloon, US Secretary of State Antony Blinked called off his previously planned visit to Beijing. In a reaction to the event, China President Xi Jinping termed this as an ‘obvious overreaction’ while also warning to not aggravate the tense situation.
Elsewhere, the hawkish Fed better gained new life after Friday’s upbeat US jobs report and activity numbers, which in turn underpinned the recovery in the US Treasury bond yields. Also likely to probe the sentiment could be the cautious mood ahead of Fed Chairman Jerome Powell’s speech on Tuesday, as well as the market’s chatters that China's stimulus will be limited.
Against this backdrop, the MSCI’s index of Asia-Pacific shares ex-Japan slumps 2.0% whereas Indonesia’s IDX Composite drops half a percent by the press time.
Looking forward, risk catalysts will be crucial ahead of Tuesday’s Fed Chair Jerome Powell’s speech. Following that, Friday’s US UoM Consumer Sentiment Index for February, as well as the University of Michigan's 5-year Consumer Inflation expectations, should be eyed for clear directions.
Technical analysis
Unless providing a daily closing beyond the 200-DMA, around $15,135 by the press time, the USD/IDR bulls are off the table.
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