Indonesia’s bonds headed for a third weekly gain and the rupiah snapped a five-week decline as foreign funds boosted holdings of the nation’s assets.
Government debt rallied as the central bank lowered its benchmark interest rate by 25 basis points to 6.50 percent on Oct. 11 and purchased sovereign bonds this month. Overseas investors bought $237 million more Indonesian shares than they sold in the first four days of this week, according to exchange data.
“We saw funds coming into Indonesian markets,” said Wiling Bolung, head of treasury at ANZ Panin Bank in Jakarta. “The confidence has returned as Bank Indonesia has managed the situation well. Certainly, the investor sentiment has turned positive.”
The yield on the 10-year bond fell 43 basis points, or 0.43 percentage point, to 6.44 percent this week as of yesterday, prices compiled by Bloomberg showed. The rupiah traded at 8,880 per dollar from 8,900 at the end of last week as of 9:13 a.m. in Jakarta, according to prices from local banks complied by Bloomberg. The currency declined more than 4 percent in the previous five weeks.
Foreign ownership of the nation’s debt rose 0.7 percent to 214 trillion rupiah ($24 billion) in the first two days of this week, according to data from the finance ministry’s website.
Bank Indonesia is selling dollars when needed to ease volatility in the currency, Deputy Governor Hartadi Sarwono said Oct. 7.(Bloomberg)
I am glad to know that investors have become more willing to invest in foreign countries such as Indonesia. Really in this day and age we should think about doing business globally and if the money doesn't lie here in the United States that we should be willing to go far and wide to get whatever business we can. Foreign investment will help the domestic economy grow not diminish it.
ReplyDelete