The GBP/IDR exchange rate moved sideways ahead of key economic numbers from the UK. The pair was trading at 18,426, which was a few pips below the year-to-date high of 18,466. It has been in a consolidation in the past few weeks.The USD/IDR, on the other hand, jumped to a multi-week high of 15,470.
UK GDP, inflation data ahead
The top forex news in the coming days will be from the UK. On Friday, the Office of National Statistics (ONS) will publish the latest UK GDP numbers for January. Economists believe that the country’s economy remained under pressure in January.
Precisely, they expect that the economy expanded by 0.1% in January after contracting by 0.5% in the previous month. Key parts of the economy are expected to remain in the red. For example, industrial production is expected to have fallen by 0.1% while manufacturing production fell by 0.2%.
The Office of National Statistics will then publish the latest UK jobs, inflation, and retail sales numbers next week. These data will be important because of their impact on the next decision by the Bank of England.
Analysts believe that the BoE will continue hiking rates in this meeting. The base case is that the bank will hike by 0.50%, bringing the official cash rate to 4.50%. It will then take a strategic pause and wait for inflation to come down.
In all, the GBP/IDR price has been in a bearish trend after peaking in December. That’s because Indonesia has been growing at a faster pace than other Southeast Asia countries. It has also seen a significant increase in inflows from foreign investors, which has helped its economy grow. It expanded by 5.3% in 2022 while the UK barely grew in the same period.
GBP/IDR price forecast
The 4H chart shows that the GBP to Indonesian rupiah has been moving sideways in the past few weeks. It remains slightly below the important resistance level at 18,496, where it has failed to move above since February. The pair is above the 25-day and 50-day moving average and is at the 38.2% Fibonacci Retracement level.
Therefore, a bullish breakout will be confirmed if the pair manages to move above this resistance level. If this happens, it will rise to the 50% retracement level at 18,683.