GBP/IDR Outlook:
Slightly positive, but likely to move sideways, as it's above the recent average yet lacks a clear driver.
Key drivers:
• Rate gap: The Bank of England’s dovish policy contrasts with the Bank Indonesia's lower interest rate, creating pressure on the rupiah.
• Risk/commodities: With global oil prices remaining stable, this benefits the British Pound while keeping commodity-dependent currencies like the rupiah under pressure.
• One macro factor: The ongoing political uncertainty in the UK continues to limit confidence in the pound, reflected in the Labour Party tensions.
Range:
GBP/IDR likely holds within its recent range, though it may drift slightly upward.
What could change it:
• Upside risk: A significant improvement in UK economic indicators could boost GBP.
• Downside risk: Further capital outflows from Indonesia and increased political instability could weaken the IDR.
