Jakarta. Rupiah extended its losses against the US dollar on Wednesday, slipping to Rp 17,725 as investors awaited key US inflation data and new signals from Federal Reserve Chairman Kevin Warsh while closely watching Indonesia’s central bank leadership transition.

The rupiah closed down 2 points, or 0.01%, from Rp 17,723 per dollar in the previous session.

Ibrahim Assuaibi, director of Traze Andalan Futures and a currency analyst, said the rupiah remained under pressure even as tensions between the United States and Iran appeared to ease.

Reports suggested that Washington and Tehran were nearing a ceasefire agreement, with Russian news agency RIA citing sources from Pakistan and Iran.

“Investors are now turning their attention to US PCE data due on Wednesday and Kevin Warsh’s first major speech as Fed chairman at the Jackson Hole symposium on Friday,” Ibrahim said in a statement. “The PCE report will provide further insight into the state of the US economy and inflationary pressures.”

The rupiah also weakened as several Federal Reserve officials signaled support for keeping interest rates unchanged. Boston Fed President Susan Collins, for instance, backed holding rates steady, provided inflation continues moving toward the central bank’s 2 percent target.

“Meanwhile, Kevin Warsh’s speech at Jackson Hole could offer clearer indications of the Fed’s view on the balance between persistent inflation and the broader economic outlook,” Ibrahim said. “The speech is particularly important as markets await greater clarity on when the Fed would be willing to adjust policy in response to inflation.”

Domestically, the rupiah’s decline came as lawmakers conducted a fit-and-proper test for Bank Indonesia governor candidate Destry Damayanti.

Destry, who currently serves as Bank Indonesia’s acting governor, told lawmakers that the domestic economic cycle had yet to reach its full potential.

She said several sectors could still be accelerated to support growth, including by improving the banking sector’s intermediation function. Undisbursed loans currently stand at Rp 2,548 trillion, or around 21 percent of total committed credit ceilings, she said.

As of 3:59 p.m. Jakarta time, Bloomberg data showed the Singapore dollar at Rp 13,951, the Japanese yen at Rp 111.47, the Australian dollar at Rp 12,728, and the euro at Rp 20,689.

Add as a preferred source on Google +