Indonesia’s rupiah fell to a three-week low after foreign funds pulled money from the nation’s stocks on concern economic growth is slowing.
Overseas investors sold $548 million more shares than they bought last week, the most since June 2013, exchange data show. Gross domestic product increased 4.93 percent in the first three months from a year earlier, near the five-year low of 4.92 percent recorded in the third quarter of 2014, according to a Bloomberg survey of 19 analysts before data due on Tuesday.
The rupiah fell 0.5 percent to 13,022 a dollar as of 9:27 a.m. in Jakarta, prices from local banks show. It touched 13,028 earlier, the weakest level since April 9. In the offshore market, one-month non-deliverable forwards declined 0.2 percent to 13,145, data compiled by Bloomberg show.
“Slowing growth is casting negative sentiment over Indonesian assets,” said David Sumual, the Jakarta-based chief economist at PT Bank Central Asia, Indonesia’s largest lender by market value. “The economy can’t rely on the external side for growth, so public spending is the catalyst we hope will pick up.”
The government had spent only 7 trillion rupiah ($538 million) on infrastructure as of April 27, compared with a full-year target of 290 trillion rupiah, Finance Minister Bambang Brodjonegoro said April 29 in Jakarta. The economy will expand 5.2 percent to 5.7 percent this year, he said. That compares with Brodjonegoro’s March 6 forecast of 5.7 percent.
Inflation accelerated to 6.8 percent in April, from 6.38 percent in March, according to a Bloomberg survey before figures due around 11 a.m. in Jakarta on Monday. That would be the fastest pace since January.
The yield on government bonds due March 2024 rose four basis points, or 0.04 percentage point, to 7.75 percent, according to the Inter Dealer Market Association.
original source: http://www.bloomberg.com/news/articles/2015-05-04/rupiah-falls-to-three-week-low-as-slowing-growth-spurs-outflows