RUPIAH STRENGTHENS FURTHER TO 9,200 PER US DOLLAR

Jakarta, Jan 7 (ANTARA) - The rupiah strengthened to nearly Rp9,200 per US dollar in the Jakarta interbank spot market on Thursday morning as positive factors enticed market players to buy up rupiahs.

At the market's opening , the local unit was quoted at Rp9.213-Rp9.223 per dollar compared to Rp9.245-Rp9.255 at the market's close on Wednesday or up 32 points.

Bank Danamon economist Anton Gunawan said the rupiah had actually already appreciated to Rp9.200 per dollar but Bank Indonesia (BI) had been intervening in the market over the past two days to prevent the rupiah from strengthening too fast.

BI did not want the rupiah to gain in value too rapidly because it would then risk dropping easily, he said.

He said the rupiah could easily strengthen to Rp9,000 per dollar but if it did, it would not stay in that position for long.

This was because market players were beginning to seek profit while there would be a higher corporate need for dollars to repay maturing debt, he said.

He said the rupiah was tending to appreciate rapidly because hot money was coming into the market in relatively big amounts, and the beginning of the year was the time for market players to consolidate their portfolios.

Anton predicted the rupiah's exchange rate against the dollar would this year range between Rp9.200 and Rp9.600.

About the possibility of the rupiah reaching the Rp6,000 per dollar level, Anton said that rate happened during the Megawati Soekarnoputri government which had sold state assets to foreign parties and thrown the proceeds into the market causing the local unit to strengthen drastically.

But it was difficult to make similar efforts now because they would affect various established interests, he said.

The rupiah was expected to continue at a position below Rp9.200 per US dollar until the weekend.

Moreover, foreign funds were continuing to flow into the market in bigger amounts than before, he said.