RUPIAH DECLINES BUT REMAINS SLIGHTLY STRONGER THAN THURSDAY MORNING

Jakarta, Aug 14 (ANTARA) - The rupiah's exchange rate against the US dollar in the Jakarta inter-bank spot market on Thursday afternoon declined but remained in a slightly better position than in the morning because of the central bank's intervention in the market.

"Bank Indonesia (the central bank) entered the market by releasing US dollars to reduce market pressure on the rupiah although its position was still under pressure," a money market analyst, Edwin Sinaga, said here Thursday.

The rupiah's position moved down ten points to Rp9.178/9.180 per US dollar (with the morning session reaching almost Rp9.200 per US dollar) from Rp 9,178/9,190 on the previous day.

However, the rupiah's position at 9.178/9.180 per US dollar was still considered positive because it was below Rp9.200, he said.

The rupiah's position at that level, below 9.200 per US dollar, was considered safe by Bank Indonesia, he added.

The local unit strengthened to below 9.100 per US dollar once (reaching 9.080 per US dollar). It was the sharpest increase it had ever made.

However, the rupiah did not remain long in this position after the decrease in the world crude price and a correction because foreign and local market players were active in purchasing US dollars to buy crude oil or pay maturing debts, he said.

The rupiah still had a chance to rise until the end of this year to the level of 9,000 per US dollar but the Indonesian currency was restrained by the weakening global economic fluctuation.

Moreover, foreign investors tended to increase their investment in the country by actively producing Bank Indonesia instruments in the money market due to the high difference of rupiah interest against US dollar.

"We are still optimistic the Indonesian market will give more gain than other Asian markets," he said.