JAKARTA, April 20 (Reuters): The Indonesian rupiah held firm on Tuesday after the central bank kept interest rates at a record low, as widely expected, resisting any further easing to foster currency stability. The rupiah strengthened 0.4% to 14,485 per dollar after Bank Indonesia's (BI) decision to stand pat on rates. Stocks in Jakarta recovered slightly, trimming losses to trade 0.3% lower. The currency has already depreciated more than 3% against the dollar this year, leaving policymakers wary about delivering further rates cuts lest it creates rupiah instability and forces out foreign funds. "The decision itself was not a surprise, given the pressure on the rupiah in recent weeks," said Mitul Kotecha, chief EM Asia & Europe strategist at TD Securities. "The fact that there have been signs of some improvement in activity reduced some of the pressure to ease further," he added. BI reaffirmed its commitment to stabilise the rupiah and said the current rate of exchange and government bond yields were attractive, ensuring that capital inflows would come and further support the currency. Analysts at Mizuho earlier said that reports President Joko Widodo is backing a bill to expand BI's mandate is seen by many as diluting the central bank's independence, which in turn is denting confidence in rupiah-denominated assets. Other emerging Asian currencies strengthened across the board, reflecting a broadly weaker US dollar. South Korea's won and the Singapore dollar added 0.5% and 0.3%, respectively. The Taiwan dollar held 0.4% firmer ahead of March export data, which analysts expect will rise for a 13th consecutive month. Stocks in the Philippines, Malaysia and Taiwan gained, while equities in Singapore fell and delivered their worst session in nearly three weeks. Indian shares edged higher after a sharp drop in the previous session, as the country ramped up vaccinations to counter a surge in Covid-19 cases that prompted restrictions in major cities and rattled investors. - Reuters
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