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Indonesia's rupiah firms

JAKARTA: The Indonesian rupiah firmed against the dollar in moderate early Thursday trading, with short-dated swaps edging up, dealers said.

One Japanese bank dealer said sentiment on the rupiah remained upbeat, possibly on the back of moderately tight liquidity, which caused short-dated swaps to edge up.

"There are no fundamental reasons for longer-term swaps to edge up. But rises in short-dated swaps had driven the longer-term to follow", one US bank dealer said.

Dealers said liquidity supply should not be tight because of apparent sufficient supply from the central bank.

"But the interbank rate has been so susceptible to an upturn in the past three days. I don't know why, although liquidity seems to be okay", one state bank dealer said.

Dealers said uncertainty on the liquidity front appeared to have caused the rupiah to inch closer to the upside of the central bank's band and deterred swap rates from declining.

Spot rupiah, due Monday, was last at 2,326.25/26.50, compared with an opening of 2,326.50/27.50. Tomorrow and today rupiah were at 2,324.0/24.5 and 2,323.15/23.90, respectively.

Overnight swap was at 0.75/0.85 and tom/next at 2.1/2.2.-Reuter