If you're deciding whether to buy the Indonesian Rupiah, you've likely already done some of the homework.
Perhaps you're thinking about buying Rupiah to round out your collection of world currency, or maybe you're thinking about exchanging it in the future through a leading dealer such as Currency Liquidator.
In any case, you'll need to have enough information, and work with a leading currency dealer. Learning is important, since the more you know about foreign currencies the more likely you are to be successful in your purchase.
Indonesia's Economy And How It Affects the Rupiah
During the past few years Indonesia's economy and the Rupiah have begun to draw more attention from observers worldwide, because of the nation's phenomenal growth. Most observers anticipate even more growth going forward.Click here to read more...
People are noticing Indonesia's booming economy - It’s is a star of the global G20 group of nations, and it’s perennially within the world’s top ten nations for growth.
Observers note that Indonesia is one of the top two fastest-growing economies in Asia. It’s expanding more rapidly than:
In fact, it’s also one of Asia’s fastest-growing markets for banking and financial services. The middle class is expanding rapidly as consumers begin to spend their new wealth.
As people begin to focus on Indonesia's economic success and its favorable demographics with the stagnant, graying economies in Europe and the U.S., they’re impressed with what they see.
Indonesia's economy is expanding far more quickly than that of most other developing nations. Year after year, the country is consistently rated as the region's second fastest-growing economy, neck-and-neck with Vietnam, and consistently higher than Thailand.
During recent years Indonesia's economy grew between 5% to 10% annually, which is quicker than the growth rates in any of the neighboring countries.
Significantly, Indonesia's development and wealth-building is much faster than China's nowadays. Indonesian GDP growth is generally 50% higher than China’s growth.
Natural Resources and Manufacturing
The archipelago nation has vast natural resources including petroleum. It's also a major exporter of:
- palm oil
...and numerous other agricultural commodities…
And, Indonesia also has abundant forest industries such as:
- milled wood products
- other fiber goods
are major exports. As well, cement is also a major export product to nations throughout the region.
The manufacturing sector is growing much more quickly than the ag sector. The country is a key outsourcing partner for major Chinese, Vietnamese and other Asian manufacturers. This broad industrial base gives the Indonesian economy a balanced position, especially with regard to exports.
Since the country is exporting more almost every year, the demand for the Rupiah is increasing as buyers need to first buy the Indonesian currency with which to purchase Indonesian products.
The value of any country's currency is ultimately tied to the strength of its economy, and Indonesia's economy is very strong indeed.
The more commodities and finished products that Indonesia exports, the higher the demand for the Rupiah, and the more support for the nation’s overall economy.
Indonesia is well-positioned for a better economic future, and that's why many people are enthusiastic about the Country.
Yet, even though Indonesia's economy has been outperforming most neighboring economies throughout Asia for the past few years, the exchange rate for Rupiah has lagged behind.
The value of the Rupiah has been stagnant for the past few years, although the economy is speeding ahead.
In 2014 the country's GDP was growing at about 6.5% annually, which keeps Indonesia within the top ten fastest-growing economies in the world.
And, in spite of the geographic distance between the two nations, economic and trade ties between America and Indonesia are traditionally very strong.
The country's main trading partners are nearby Japan with about 15% of total trade, regional partner China with about 12%, and the far-away U.S. with nearly 10% in trade volume.
Nowadays the Indonesian economy is booming and the government treasury has plenty of cash. The country appears destined to continue with a strong growth rate for at least another ten years.
Indonesian Rupiah Notes and Denominations
The Indonesian Rupiah (Symbol: IDR) is Indonesia's national currency. It's issued and overseen by the Bank of Indonesia.
The first modern Rupiah banknote was issued beginning in 1945 when the nation emerged from World War II into independence from the previous Dutch and Japanese administrations.
Rupiah banknotes are made of special paper that contains pulp from the woody fiber of the Abaca tree. This fiber is said to add toughness and durability to the notes.
The notes contain a variety of security features. These include security threads as well as watermarks and electrotypes.
Notes issued beginning in 2010 introduced some new security features:
- EURion constellation rings to foil photocopier counterfeiting
- color-change printing that changes colors in different viewing angles
- raised printing to help the blind distinguish between note denominations.
The denominations circulating today are the IDR 1000, 2000, 5000, and 10,000 notes, as well as the 20,000 and 50,000 and 100,000 notes. Because of past inflation, even small transactions are conducted with banknotes instead of coins.
Where to buy Indonesian Rupiah
The Internet is awash with currency dealers, but many of them are part-time or, worse, short-time businesses. When you're ready to buy the Rupiah, you should choose a leading dealer that provides excellent customer service.
The best way to buy Indonesian Rupiah
It's always best to work with a dealer that offers exceptional pricing for Rupiah and other foreign currencies, as well as a written guarantee that you will receive authentic currency.
At the top of the class, the best dealer will offer even more: Buy-back guarantees so you can sell the Rupiah back to the dealer if you ever want to.
Buy Indonesian Rupiah with an echeck
Top dealers accept payments via echeck because those methods are generally the safest and easiest ways to buy foreign currency.
It's important to note that the leading currency dealers are fully registered with the U.S. Treasury Department as money-services companies, they're also members in good standing of the Better Business Bureau (BBB).
The best Rupiah dealer is Currency Liquidator, which is an A-rated member of the Better Business Bureau with a record of zero complaints against it.
That's a rock-solid qualification to consider when you're looking to buy the Rupiah.
Should I buy the Indonesian Rupiah?
You should always do your own due diligence before you buy the Indonesian Rupiah or any other foreign currency. You should research the following areas –
- Economic growth rate in Indonesia
- Industrial and manufacturing development
- Social and political stability
- Government's monetary and economic decisions and policies
The value of the IDR has been sluggish in recent years. Beginning several years ago, the Bank of Indonesia and government leaders instituted policies which have kept the currency’s value low.
Back when inflation was affecting the economy, it made sense to set the foreign-exchange conversion rate for Rupiah at an artificially-low level as a precautionary measure to avoid the problem of inflation.
Yet, the downside of the government’s conservative monetary policies is that the central bankers continue to be extremely conservative with regard to pricing for the Rupiah.
Changes For Indonesia and the Rupiah are on the Horizon
Under President Joko Widodo (also called “Jokowi”) the government’s new policy is to balance the country's economy between bulk commodity exports and manufacturing of technology and consumer products.
The government also appears to be more open to more liberal monetary policies which could spur the economy to grow even more quickly.
The diverse archipelago offers an attractive manufacturing business hub for value-added trade between Australian and Asia.
Labor is relatively low cost here – Factory jobs typically pay around $290 per month. So, Indonesian monthly labor costs less than Chinese labor ($400+) or Thai labor ($350+). As a result, manufacturers are coming to Indonesia in droves.
The Rupiah is backed up by Indonesia's robust economy, which continues to grow rapidly year after year. And, the Bank of Indonesia maintains fat foreign-exchange reserves, so the currency is supported well.
The value of the Rupiah has been arbitrarily lowered several times in recent years by perhaps over-zealous central bankers and other government officials. Central bankers traumatized by inflation set the foreign-exchange rate for Rupiah at an artificially-low level.
As the country’s manufacturing and petroleum industries grow ever larger, nearly all observers believe that the Indonesian economy will prosper going forward.