Indonesia's rupiah at 3-month low as Asian currencies struggle; Brazil in focus
SPY•The rupiah weakened past 18,100 per dollar to its lowest level since late July, while the Philippine peso hit a record low of 63.865. Investors also focused on political developments in Brazil and central bank decisions due this week.
1. Rupiah weakens further
The rupiah fell to 18,115 per US dollar on Monday, down about 8% so far this year and the region’s worst-performing currency. Indonesia’s stock index dropped more than 1% early in the session before trimming its decline to about 0.8%.
2. Regional markets slip
An MSCI gauge of emerging-market currencies fell 0.2%, while the Philippine peso reached a record low of 63.865 per US dollar. HSBC analysts cited concerns about the Philippines’ current account deficit, low foreign direct investment and dwindling foreign-exchange reserves.
3. Brazil and policy decisions
Investors monitored the fallout from Luiz Inacio Lula da Silva’s election victory after Senator Flavio Bolsonaro refused to concede. Brazilian markets had yet to open; the real was up 6.4% so far this year and the Bovespa index was 8.4% higher. Investors also awaited central bank decisions this week, with markets pricing in steady rates from the Federal Reserve, Bank of Japan and European Central Bank.
