Govt Must Move Fast
The government must move quickly to deal with the weakening of the rupiah. Due to external factors, government steps that are too slow can trigger speculation.
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A worker carries a batch of beach sarongs to the banks of the Solo River on Monday (9/3/2018) as lengths of colorful fabric dry under the sun in Laban village, Mojolaban district, Sukoharjo regency, Central Java. Local businesses have been impacted by the rising price of raw materials, such as fabrics and dyes, due to the weakening rupiah against the US dollar, while their profits have been shrinking from an inability to increase the selling price.
JAKARTA, KOMPAS — The government must move quickly to deal with the weakening of the rupiah. Due to external factors, government steps that are too slow can trigger speculation.
These external factors are part of a plan by the United States’ central bank, the Federal Reserve, to raise benchmark interest rates and US plans to further increase import tariffs on China. The negative sentiment will worsen with the financial crisis in Argentina and Turkey, which market participants fear may spread to other developing countries.