RUPIAH DOWN FIVE POINTS TO RP9,270 PER DOLLAR ON MONDAY

Jakarta, June 23 (ANTARA) - The rupiah fell five points to Rp9,265/9,270 per dollar in the Jakarta interbank spot market on Monday as the US greenback strengthened against other major foreign currencies, a foreign exchange analyst said.

"The dollar strengthened as investors were optimistic the US Federal Reserve will keep its interest rate at 2 percent," retail banking director of PT Bank Mega Tbk, Kostaman Thayib said on Monday.

The rupiah closed at Rp9,260/9,265 per dollar at the weeekend.

Kostaman said the Fed was expected to keep its interest rate unchanged because it was still worried about the current financial crisis in the US.

The Fed's stable interest rate at 2 percent prompted investors to buy dollars causing the rupiah to weaken slightly on Monday, he said.

It ass still hard for the rupiah to strengthen to Rp9,250 per dollar after it fluctuated within a range of Rp9,260 to Rp9,270 per dollar two days ago, he said.

Some analysts had earlier predicted the rupiah would continue to strengthen to below Rp9,250 per dollar, he said.

It was somewhat difficult for the rupiah to reach a level of Rp9,250 per dollar but the market was still optimistic about the rupiah's appreciation as a number of foreign investors were active in investing their capital in the domestic market, he said.

The Fed's two-day meeting to discuss a rise in its interest rate would prompt investors to actively engage in the domestic market owing to the higher difference between the dollar and rupiah interest rates, he said.

The dollar's appreciation against other major foreign currencies had encouraged investors to buy the greenback, he said.