Oct. 17 (Bloomberg) -- Indonesia’s rupiah rose, trading at the strongest level in two weeks, after global funds boosted holdings of the nation’s assets to benefit from a strengthening local economy. Bonds climbed.
Overseas investors bought $218 million more Indonesian shares than they sold last week, according to exchange data. Growth in gross domestic product may quicken to at least 6.4 percent this year, Trade Minister Mari Pangestu said Oct. 15, from 6.1 percent in 2010. The rupiah gained for a third day after finance ministers from the Group of 20 nations endorsed part of a plan to contain Europe’s debt crisis over the weekend.
“Funds are coming in as Indonesia’s economic-growth story is intact,” said Gundy Cahyadi, an economist at Oversea-Chinese Banking Corp. in Singapore. “The market has stabilized somewhat as the central bank is consistently intervening. The general tone is of optimism over the G-20 statement.”
The rupiah rose 0.3 percent to 8,819 against the dollar as of 4 p.m. in Jakarta, according to prices from local banks complied by Bloomberg. That was the strongest level since Sept. 30. Bank Indonesia is selling dollars when needed to ease exchange-rate volatility, Deputy Governor Hartadi Sarwono said Oct. 7.
G-20 finance ministers and central banks agreed on an emergency plan to avoid a debt default by Greece and set an Oct. 23 summit of European leaders in Brussels as the deadline for it to be delivered.
The yield on the government’s benchmark 10-year bond fell seven basis points, or 0.07 percentage point, to a record low of 6.31 percent today, prices compiled by Bloomberg showed.
Foreign ownership of the nation’s debt rose to 217.3 trillion rupiah ($24.6 billion) on Oct. 13, from 212.5 trillion on Oct. 7, according to data from the finance ministry’s website.
--Editors: Greg Ahlstrand
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