SEOUL: The rupiah hit a seven-week high in offshore markets on Wednesday as Jakarta Governor Joko "Jokowi" Widodo looked set to win Indonesia's presidential election, raising hopes of reforms that would attract more foreign investment.
Other emerging Asian currencies also rose, led by the Thai baht, due to broad weakness in the dollar and a stronger Chinese yuan.
Jokowi claimed victory soon after the close of Wednesday's closely fought presidential race.
He has a clean image and a reputation for competence in local government, a contrast to the autocracy, corruption and power politics that have weighed down Southeast Asia's biggest economy for decades.
After news of the initial election counts, the rupiah's one-month non-deliverable forwards rose as much as 2.0 percent to 11,500 per dollar, the strongest since May 22. Other NDFs hit their strongest levels since late May.
Indonesia's high-yielding dollar bonds rallied, with bonds due in 2044 trading as much as 2.5 points higher at 118/118.5 cents to a dollar. That took the yields on the bonds, issued in January with a coupon of 6.75 percent, to 5.5 percent.
"With Jokowi's victory, foreign investment will increase greatly," said Yuna Park, a currency and bond analyst at Dongbu Securities in Seoul.
Domestic markets in Indonesia were closed on Wednesday because of the election. The rupiah has gained 3 percent against the dollar since last week in domestic trade.
The official outcome of the election will not be known until July 22 and the Constitutional Court has until Aug. 22 to rule on any challenges.
Jokowi's competitor, ex-general Prabowo Subianto, has refused to concede. Challenges could drag things out and may add to concern about the potential for violence between the two sides.
BAHT, PHILIPPINE PESO UP
The Thai baht rose 0.4 percent to 32.24 per dollar at one stage, its strongest since April 28, on the back of inflows into stocks and bonds.
Demand for the baht intensified after a break through 32.36 and 32.30, traders said.
The Philippine peso advanced 0.2 percent to 43.31 against the greenback, its strongest since Nov. 8, on expectations the central bank could raise interest rates this month.
The central bank will not hesitate to tweak monetary policy to ensure inflation remains within target, even as it continues to assess the impact of current price pressure, its governor said.
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