• USD/IDR fades bounce off intraday low on weaker-than-expected Indonesia Inflation figures for April.
  • US dollar strength tests pair sellers ahead of the key US PMIs.

USD/IDR holds lower ground near the intraday low of $14,433, up 0.03% around 14,446 by the press time of the pre-European session on Monday. In doing so, the quote refrains from extending Friday’s gains even as Indonesia’s Inflation drops in April.

As per the latest data, Indonesia’s Inflation eases from 1.46% expected to 1.42% YoY, also declining below 0.17% monthly forecasts to 0.13%, in April. Details suggest that the Core Inflation followed the suit with 1.18% figures versus 1.22% market consensus.

It’s worth mentioning that the risk-on mood in Asia seems to help Indonesian rupiah (IDR) even as off in China and Japan restricts market moves. As a result, the Asian currency battles the US dollar gains, mainly led by the hopes of further US stimulus and chatters over reflation.

At home, political jitters concerning the government’s push for compulsory tests and the covid woes seem to challenge USD/IDR bears.

Amid these plays, S&P 500 Futures print 0.35% intraday gains while the US dollar index (DXY) stays firmer after the biggest gains in a month, posted on Friday.

Looking forward, US PMI figures for April will be the key while market reaction to the risk catalysts may offer extra direction to USD/IDR.

Technical analysis

Unless crossing a 13-day-old falling resistance line, around $14,535, USD/IDR buyers may refrain from fresh entries.

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