S&P 500 — US Large Cap Index
FTSE 100 — UK Blue Chips
Euro Stoxx 50 — Eurozone Leaders
DAX 40 — German Equities
CAC 40 — French Market Index
Nikkei 225 — Japan Benchmark
Hang Seng — Hong Kong Index
Shanghai Composite — China Mainland
ASX 200 — Australian Market
TSX Composite — Canada Index
Nifty 50 — India Large Cap
STI Index — Singapore Market
KOSPI — South Korea Index
Bovespa — Brazil Equities
JSE Top 40 — South Africa Index
IPC Index — Mexico Market
Lloyd Chan at MUFG highlights that USD/IDR has broken to fresh highs, overshooting earlier expectations for near-term stabilization. The move is attributed more to domestic confidence and fiscal uncertainty than broad US Dollar (USD) strength. While upside risks have increased, MUFG also flags growing signs of Rupiah undervaluation and potential constraints from Bank Indonesia’s policy response.
Domestic confidence shock drives USD/IDR
“USD/IDR has reached fresh all-time highs around 17,300 level. This overshoots our prior near-term stabilisation view around 17,000. This move appears less about global USD strength and more about a domestic confidence shock, with markets likely reacting to heightened fiscal uncertainty.”
“In the near term, upside risks to USD/IDR have clearly widened, with sentiment still fragile. The speed and direction of the latest move suggest markets are demanding a higher risk premium, particularly as oil prices remain elevated and fiscal-energy dynamics stay unfavourable.”
“However, at the same time, valuation signals are becoming increasingly compelling, pointing to meaningful rupiah undervaluation versus the US dollar, while technical indicators show USD/IDR moving into overbought territory. Policy response functions could become more binding, with Bank Indonesia firmly focused on rupiah stability. Indonesia’s sovereign CDS spreads have not shown the kind of blowout typically associated with a loss of macro anchor.”
