The Indonesian rupiah dropped today on concerns that rising oil prices will hurt the trade balance and on speculations that importers were hoarding dollar.
Indonesia has the same problem as India — rising prices for crude oil will likely cause the trade balance deficit to widen. The trade gap already reached $1.96 billion in April — the highest level in nine months. Additionally, there were signs that companies were buying dollars to pay for imports. As a result, the rupiah was the worst-performing Asian currency this month, falling as much as 2.7 percent.
USD/INR rose from 11,940.00 to 11,996.50 as of 12:18 GMT today.
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