USDIDR extends gains above 15,500 as Indonesian exports miss estimates

• USDIDR has recorded extra gains above the 15,500 hurdle as Indonesian exports have missed projections.
• US Retail demand has been robust amid the tight labor market.
• Fed Brainard has supported the view of rate hike slowdown consideration.

The USDIDR pair has extended its recovery above 15,500 in the Tokyo session as Indonesian exports have missed estimates. The export numbers increased by 12.30% vs. the Reuters poll of 13.85%, which has dented demand for the Indonesian Rupiah.

Lower-than-projected Indonesian export numbers could impact their trade balance ahead. Meanwhile, the US dollar index (DXY) is displaying a subdued performance in Tokyo. The mighty DXY is facing barricades while overstepping the immediate hurdle of 107.00. Market mood has turned quiet as the US economic calendar has nothing much to offer this week except the Retail Sales data, which will release on Wednesday.

The Retail Sales data for October month is seen climbing to 0.9% against the prior release of 0%. Retail demand has been robust amid the tight labor market. It is worth noting that the inflationary pressures declined in October. In spite of that, Retail Sales is seen higher, which indicates an upbeat households confidence.

Apart from that, mixed cues from Federal Reserve (Fed) policymakers over the policy tightening pace have shifted the DXY into a chartered territory. As per the CME FedWatch tool, the chances of fifth consecutive 75 basis points (bps) rate hike have slipped below 20%.

Fed Vice Chair Lael Brainard supports the view of reducing the pace of policy tightening. She cited that “It will soon be appropriate for the Federal Reserve to reduce the pace of its interest rates hikes”, in an interview with Bloomberg.