Macroeconomic Forecast Indonesia

Given our long-term bullish view on Indonesia's economy, we are forecasting a broadly strengthening trajectory for the rupiah over the next 10 years, taking the currency from IDR9,400/US$ in end-2009 to IDR8,000/US$ by 2019. However, with an expected slowdown in the key global economies including China, the US and eurozone in the coming quarters, risk aversion might persist over the medium terms, thereby negatively impacting on the rupiah. As such, we have kept our rupiah forecast relatively stable at around IDR9,100 for 2010 and 2011.

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