Jakarta (ANTARA) - The exchange rate of the Indonesian rupiah, transacted between banks in Jakarta on Tuesday morning, weakened over steadily escalating trade hostilities between the United States and China.
On Tuesday, the rupiah depreciated 32 points, or 0.22 percent, to Rp14,455 per US dollar, than Rp14,423 per US dollar recorded on the previous day.
Samuel Aset Management economist Lana Soelistianingsih remarked in Jakarta on Tuesday that the global market sentiment had veered to the negative in addition to heightened uncertainty over the ongoing exchange of threats and retaliation between the United States and China.
"This trade conflict will lower the volume of world trade and cause a global economic slowdown," Soelistianingsih cautioned.
After trade talks between the world's two largest economies failed to yield a deal, China's kneejerk reaction was to impose new retaliatory tariffs on US$60 billion worth of US goods, effective from June 1, 2019, days after the United States announced it will impose higher tariffs on $200 billion in Chinese goods on Friday (May 10) last week.
President Trump appears to not like this retaliation and has threatened tariffs on possibly another $350 billion worth of Chinese goods. Although tariffs have been implemented, negotiations are reportedly ongoing.
Soelistianingsih has forecast that on Tuesday, the rupiah can yet potentially strengthen in the range of Rp14,400 per US dollar to Rp14,420 per US dollar.
Source: ANTARA News