The Indonesian rupiah experienced a sharp decline against the US dollar following robust US data and post-election lawsuits, triggering foreign outflows in the domestic financial market. According to Refinitiv, the rupiah closed down by 0.77% at Rp15,775/US$, marking its weakest level since January 30, 2024.
On a weekly basis, the rupiah also depreciated by 1.19%, marking its worst performance since January 22, 2024.
Meanwhile, the DXY strengthened to 104.28 at 14:51 WIB, up by 0.84% from the previous trading day's close of 103.41.
The depreciation of the rupiah is closely tied to the significant appreciation of the DXY observed today.
The Purchasing Managers' Index (PMI) for the US manufacturing sector surged to a 21-month high of 52.5 in March 2024 from 52.2 in February, surpassing market expectations of 51.7, according to preliminary estimates. This is expected to add pressure on inflation, something not anticipated by the US Federal Reserve (The Fed) in its statement on Wednesday.
Furthermore, today's movement in the rupiah was driven by political sentiment stemming from post-election lawsuits filed with the Constitutional Court (MK) challenging the election results announced by the General Elections Commission (KPU). This could potentially lead to foreign funds exiting Indonesia.
The National Legal Team (THN) of Anies Baswedan and Muhaimin Iskandar (AMIN) officially filed a legal challenge against KPU's Decision No. 360/2024 Regarding the Determination of the 2024 Election Results to the Constitutional Court (MK). The lawsuit was received by MK with number 01-01/AP3-PRES/Pan.MK/03/2024 dated March 21, 2024, at 09:02 WIB.
In the documents submitted to MK, the Head of AMIN Legal Team, Ari Yusuf Amir, requested a repeat of the 2024 elections, citing numerous instances of fraud that disadvantaged the AMIN pair. He also stated that if the 2024 elections were repeated, Vice Presidential candidate 02 Gibran Rakabuming Raka would not need to participate.
Subsequently, presidential candidate number 3, Ganjar Pranowo, finally took action by filing a lawsuit against KPU's Decision No. 360/2024 Regarding the Determination of the 2024 Election Results to the Constitutional Court (MK). Ganjar revealed several pieces of evidence of election fraud in the 2024 Presidential Election.