RUPIAH PLUNGES TO RP11,000 PER US DOLLAR ON FRIDAY MORNING

Jakarta, Oct 31 (ANTARA) - The rupiah plunged to Rp11,000 per dollar in the Jakarta interbank spot market on Friday morning as market players again bought US dollars in big amounts.

The rupiah traded at Rp11,100/11,400 per US dollar early Friday compared to the previous day's close at Rp10,600/10,625 per dollar, or down 500 points.
Market players bought US dollars again because the market turmoil was still high which showed the money market had not yet calmed down, according to Edwin Sinaga, president director of Finan Corfindo here on Friday.
It appeared, the strengthening of the rupiah over the pat two days was just a temporary reprieve from market pressure as it came under under pressure again on Friday until it fell the level of Rp11,000 per US dollar, he said.
The negative market pressure might push the central bank, Bank Indonesia (BI), to intervene in the market again to protect the rupiah.
"We are optimistic that BI will intervene again by releasing US dollars in order to ease the pressure on the rupiah," he said.
The financial crisis in the United States was not over and it was hard to predict whether world economic growth next year would be better or worse, he said.
Likewise, no one could predict whether the rupiah would be able to stay at the level of at least Rp10,000 per US dollar or plunge further due to increasing market pressure, especially from external markets, he said.
A chance for the Indonesian currency to strengthen and rebound to the level of Rp9,500 per US dollar was getting very slim, he said.
An observer recently said the rupiah had so far been overvalued against the US dollar so that its exchange rate had continued to come under pressure.