Indonesia adds a pinch of chili against the US dollar with rate hike


Bank Indonesia is ever-mindful of the rupiah’s vulnerability. — AFP

Indonesia has bolstered its credentials as an emerging market leader – at some potential cost. The country took a surprising step to shore up its faltering currency by raising interest rates, and foreshadowed the tough choices confronting Asian economies in coming weeks.

Officials had hoped that hikes were well behind them, but the US dollar hegemon in foreign-exchange markets had other ideas.

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