Suharto "postpones currency board indefinitely"
Indonesian President Suharto has decided to postpone indefinitely a plan to establish a currency board to regulate the nation's rupiah currency a Singapore newspaper reported Sunday. "The draft legislation and presidential decrees are ready but Suharto has decided not to sign them anytime soon.", the Straights Times quoted an unidentified source. The english-language newspaper said Suharto was finally convinced by the strong international opposition to the plan, which would peg the rupiah to a fixed rate, following a warning by visiting German finance minister Theo Waigel on last Wednesday. "Mr. Waigel made it clear that if he went ahead, then he would not just be defying the IMF, but also disregarding the developed countries" a source said. "It would be Indonesia versus the rest of the world".
So as the markets wake up this morning here in Asia, and realize that Japan will do nothing more to stimulate its economy, and that there is virtually a standstill on any progress or resolution in Indonesia, and that there has been virtually no good news, I doubt very much that the mini rally seen lately will be sustained. I think regional markets will be down more then 5% on average.
Best,
Stitch |
