January 16, 2020 / 5:08 AM / 3 days ago

UPDATE 1-Indonesian president says a rapidly rising rupiah may upset exporters

(Adds c.bank deputy gov comment)

JAKARTA, Jan 16 (Reuters) - Indonesia’s President Joko Widodo said on Thursday exporters may be upset if the rupiah exchange rate strengthens too quickly against the dollar , as the currency trades near a two-year high.

“Our currency is strengthening, but be careful if the strengthening happens too rapidly,” he said at a finance industry event in Jakarta. “Exporters may not be happy about a stronger rupiah because our competitiveness may decline.”

The rupiah has rallied in recent weeks, up about 1.6% so far this month, leading the gains among emerging Asia currencies.

Speaking to Reuters on the sidelines of the event, Dody Budi Waluyo, deputy governor at Bank Indonesia (BI), said that a stronger rupiah will not automatically reduce competitiveness of Indonesian exports, especially when other currencies in the region have also strengthened against the dollar.

“Stronger rupiah would help reduce costs and it would also be more efficient for exporters who have debt in foreign exchange,” he said.

Waluyo added the currency strength reflects improving global fundamentals and that the central bank isn’t seeing a need to intervene in the market. (Reporting by Maikel Jefriando, Tabita Diela; Writing by Fransiska Nangoy; Editing by Muralikumar Anantharaman)

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