Former US Treasury Secretary Connery once said: "The US dollar is our currency, but it is your trouble."
Recently, as the Federal Reserve's tough monetary policy stance triggered concerns about the economic slowdown and increased the US dollar's risk aversion attractiveness, the US dollar index once soared, while other non-US currencies were in a depreciation storm.
Many countries have begun to launch a "monetary defense war" . After the Japanese government and the Bank of Japan entered the market to buy yen last week, after 24 years, the first foreign exchange intervention since June 1998, the Indonesian government also joined the "war situation".
According to media reports, a senior official of said on Monday that the Indonesian central bank has been taking "triple intervention" measures to prevent any excessive decline in Indonesian rupiah .
Indonesian Central Bank uses the term "triple intervention" to describe its intervention in spot exchange rate , domestic no principal delivery forward exchange rate and bond market to calm the fluctuations of the Indonesian rupiah.
Indonesian Central Bank said that the depreciation of the Indonesian rupiah is still controllable.
In addition to Indonesian , Indian traders said the RBI may have sold the US dollar to curb the decline in the rupee. The rupee has hit a new low for three consecutive trading days.
USD is the top, emerging market currencies suffer
Earlier on Monday, the US dollar index broke through the 114 mark for the first time since May 2002, and has risen about 20% so far this year. Most currencies in the Asia-Pacific region have hit multi-year lows with the U.S. dollar.
Philippine Peso and Indian Rupee hit historical lows of 1 USD 58.9 Peso and 81.5525 rupee respectively.
Malaysian ringgit fell 0.4% against the US dollar to 4.5960 ringgit , the lowest level since January 23, 1998; the Thai baht fell 0.8% at one time, hitting a low of more than 16 years.
Singapore yuan and Indonesian rupiah fell 0.3% and 0.6% respectively, both currencies hit their lowest levels since April 2020. So far this year, the Indonesian rupiah has depreciated by about 6% against the US dollar.
Foreign exchange strategist at OCBC (OCBC) said:
"The global growth concerns caused by tightening financial environment, the continued strengthening of the US dollar, and the slowdown in Europe have created a challenging stage for the pro-cyclical Asian currencies."
Global head of foreign exchange research at HSBC Bank said:
"The high yield (nominal and actual), global growth weak, and the fragile risk appetite , combined with these factors is a good sign for the US dollar."
"If the US dollar is to turn, then these drivers need to change direction, or at least lose a lot of motivation."
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