JAKARTA. Tomorrow (27/3), Singapore's financial markets will discontinue the use of the price of USD/IDR (IDRVWAP) as a benchmark in the non-deliverable forward (NDF) market. Instead, the NDF market will use the Jakarta Interbank Dollar Spot Rate (Jisdor) compiled by Bank Indonesia (BI) as a reference for transaction. NDF are derivative instruments in the foreign exchange market that is similar to the gambling tools. Simply put, NDF market is a betting the market like a casino. The players in the NDF guess about the direction of a currency in the future. Because of the extent guesswork, there isn’t transfer of cash. That is why, some economists believe, the reference changes could be positive for the rupiah since it will curb the action of speculators. David Sumual, Economist at Bank Central Asia Tbk (BCA) said, the transfer of reference to use Jisdor could reflect the movement of real dollars in the NDF market.
NDF New Reference Will Help Rupiah
JAKARTA. Tomorrow (27/3), Singapore's financial markets will discontinue the use of the price of USD/IDR (IDRVWAP) as a benchmark in the non-deliverable forward (NDF) market. Instead, the NDF market will use the Jakarta Interbank Dollar Spot Rate (Jisdor) compiled by Bank Indonesia (BI) as a reference for transaction. NDF are derivative instruments in the foreign exchange market that is similar to the gambling tools. Simply put, NDF market is a betting the market like a casino. The players in the NDF guess about the direction of a currency in the future. Because of the extent guesswork, there isn’t transfer of cash. That is why, some economists believe, the reference changes could be positive for the rupiah since it will curb the action of speculators. David Sumual, Economist at Bank Central Asia Tbk (BCA) said, the transfer of reference to use Jisdor could reflect the movement of real dollars in the NDF market.