USD/IDR Price News: Rupiah pulls back from 11-week top on mixed Indonesia inflation

• USD/IDR pokes intraday high while keeping the bounce off mid-June lows.
• Indonesia Inflation eases in August, Core Inflation beats forecast.
• US Dollar tracks firmer Treasury yields to the north ahead of the key US data.

USD/IDR extends recovery moves from multi-day lows while picking up bids towards an intraday high of $14, 306, up 0.50% on a day heading into Wednesday’s European session. In doing so, the Indonesian rupiah (IDR) pair traders cheer the US dollar rebound and mixed Indonesia inflation data for August.

Indonesia's Inflation eased on monthly basis by matching the 0.03% forecast versus 0.08% previous readouts. The yearly figure, however, eased below 1.6% expected outcome to 1.59% but remained above 1.52% previous readouts. Further, the Core Inflation rose past 1.3% market consensus to 1.31%, down from 1.4% prior.

Also favoring the USD/IDR recovery is US Dollar Index (DXY) rebounds from the lowest levels since mid-August, up 0.11% around 92.76 by the press time.

Mixed concerns over the upcoming moves of the US and European central banks join a lack of clarity over the coronavirus concerns to portray the cautious optimism in the markets, underpinning the US dollar. Recently, chatters over the European Central Bank’s (ECB) bond purchase cut gained momentum due to strong inflation data from the bloc. Though, US data kept confusing traders and highlight incoming data flow, as previously signaled by Fed Chairman Jerome Powell.

Against this backdrop, S&P 500 Futures rise 0.30% by the press time whereas the US 10-year Treasury yields stretch the previous day’s upside to 1.33%, up to three basis points (bps).

Given the lack of major data/events at home, USD/IDR moves will depend upon the incoming US data, namely the US ADP Employment Change and ISM Manufacturing PMI for August. Forecasts favor a firmer print of the early signal for Friday’s NFP, contrasts to a downbeat ISM Manufacturing PMI figures.

Technical analysis

Unless crossing the 200-DMA level of $14,310 on a daily closing basis, USD/IDR bears remain hopeful.