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The movement of the exchange rate Thursday (31/12) is predicted to continue strengthening the limited strength yesterday. This action triggered profit taking on the U.S. dollar since the valuasinya already overbought.

Standard Chartered Bank economist Eric Alexander Sugandhi said the rupiah to strengthen the potential of today's opportunities triggered profit taking action against the U.S. dollar is overbought valuasinya. "Rupiah will be in the range 9400-9500.

Furthermore, Eric said, the strengthening of the rupiah today also triggered technical factors, following the correction has happened since last week due to the strengthening U.S. dollar trend.

"But, actually there is no sentiment that can significantly raise the exchange rate, so the increase is only due to the rupiah demad factor in trading," he said.

Moreover, he continued, trading in financial markets tend to be thin today, because today is the last day of trading this year. As a result, very easy for the rupiah to strengthen the transaction due to the thin end of the year before the holiday.

Bank Indonesia announced in a press release Thursday, (31/12) This foreign exchange transactions between Bank Indonesia and banks normally apply.

Furthermore Eric said, for the first quarter of 2010 the rupiah will weaken to as low as 9700. However, this correction is not because of internal factors, but because of the strengthening U.S. dollar in the first quarter of next year. "The reason the U.S. economy in the first quarter will experience slowing growth," he explained.

Therefore, the positive effect of fiscal stimulus package in the country has run out. Meanwhile, the movement of the dollar is still contra-cyclical. "If the U.S. economy was perceived to deteriorate, the dollar strengthened and the rupiah will also be depressed," he said.

The reason, as a save haven currency, U.S. dollars will be hunted investors primarily on safe assets like U.S. Treasury. "Therefore, there is the risk of weakening rupiah but not because of internal factors but a factor strengthening U.S. dollar," he said.

Similarly, he continued, would be experienced by Asian countries other. However, how the weakening rupiah will depend on how bad the economic slowdown in the U.S.. "But it will not weaken too far and the potential for a stronger rupiah in 9700 under still there," he concluded.

Exchange rate of rupiah in the foreign exchange spot market interbank Jakarta, Wednesday (30/12) 52 points close higher (0.547%) against the U.S. dollar to 9440/9445, rather than yesterday's position on the 9492/9497 level.

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