JCI recorded 29 July’s tepid close, impeded by IDR280 billion worth of capital outflows. It was 9-day losing streak as markets held off on making big moves ahead of central bank’s monetary decisions. BoJ left its rates unchanged at -0.1% but committed to looser monetary policies if the slowdown in broader economy jeopardizes Japan’s recovering economy. The
Fed, taking a contrast stance to BoJ, cut its rates by 25 bps to 2%-2.25% bolstering muted inflation to fall shortly at the Fed’s target range of 2% and economic acceleration, as well. It also emphasized that 31 July’s rate cut–the first looser monetary rate since its near zero rate cut in the gloomy days of financial crisis–should not be translated into other large cut appropriate for the remaining 2019. JCI’s two-day rebound streak on mid-days of last week was a payback for two-day losing streak on early days of last week. A glance at domestic data, the Coordinating Investment Board (BKPM) disclosed the 2Q19 foreign investment to settle at 9.61%: a start of recovering investment trend in Indonesia. The 2Q19 foreign investment figure
was a positive catalyst for JCI’s rebound. On Friday, the domestic sentiment was July’s core inflation of 3.18% YoY lower than June’s 3.25%, while the external sentiment is Trump’s administration imposing another tariffs measures exaggerate the trade war tensions, weakening Asia markets. JCI on a weekly basis closed higher at 6,340.
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