USD/IDR Price News: Rupiah snaps two-day losing streak below $14,500 on Indonesian FinMin’s comments

• USD/IDR retreats towards the intraday low after poking one-week high the previous day.
• FinMin Sri Mulyani Indrawati eyes pragmatic move out of the fiscal easing.
• Risk-off mood checks Rupiah’s gains ahead of US data, Fedspeak.

USD/IDR drops to $14,427, down 0.25% intraday, following comments from Indonesian Finance Minister (FinMin) Sri Mulyani Indrawati on early Wednesday. In doing so, the quote defies the previous two-day uptrend while also consolidating amid downbeat market sentiment.

While US stimulus and inflation implications were cited as the main catalysts for the Indonesian fiscal consolidation, Indonesian FinMin Mulyani eyes pragmatic response when asked about the timeframe when asked about the timeframe of fiscal consolidation. Even so, comments that Indonesia's external accounts better than during 2013 'taper tantrum' favor IDR bulls.

Additional comments,

Indonesia will not withdraw fiscal support abruptly.

Indonesia's 2022 fiscal deficit will be definitely lower than this.

Indonesia sovereign wealth fund expected to alleviate burden on state budget to support economy.

If the situation changes and requires us to respond differently, we will update markets on agreement with central bank about bond purchases.

Our inflation still very low, demand weak.

Indonesian authorities committed to support economy, watching market dynamics and impact on inflation, etc.

FX implications

Although the aforementioned comments favor the Indonesia rupiah (IDR) bulls, strong US bonds and risk-off mood test the USD/IDR declines.