Author: yosefardi.com

On Wednesday (May 25) the Rupiah weakened to Rp13,671 against the U.S. dollar from Rp13,606 in the previous day amid growing speculation about a sooner-than-expected interest rate hike in the U.S.A. as well as sliding oil prices. After the release of the Federal Reserve’s April policy minutes, investors and analysts have become increasingly aware that another interest rate hike may come earlier than expected.

Corporate bonds have now reached 2.2% of the gross domestic product (GDP), but the figure is still far behind the Philippines (5.8%), Thailand (17.4%), and Singapore (32.4%). Bank Indonesia (BI/Central Bank) Governor Agus Martowardojo told the press that the sources of funding for economic development must be expanded or diversified, instead of depending on the banking sector.

Asian stocks rose, sending the regional equities benchmark gauge toward the biggest two-day gain in more than a month, as optimism the U.S. economy is strong enough for increased interest rates fueled a global equity rally, Bloomberg reported. Crude oil neared $50 a barrel after a government report showed that U.S. crude inventories and production declined, easing concern over a global glut in the commodity.