It may not be completely felt by everyone, especially for those who are not directly involved in forex, but for the past two weeks, it has been experiencing highs against several currencies all over the world. This may be brought to the fact that investors have become more cautious of their investments, and they would rather focus on less risky assets such as that of the greenback. There are a lot of forex traders who have lessened their hunger for any kind or risk.

The Gainers and Losers

According to Jessica Hoversen, an analyst for currency and fixed income in MF Global, the entire world will still going to feel the downfall of the economy, and the growth that everyone is expecting is still bleak. However, in the process, the U.S. dollars are actually considered to be the safest asset that investors would like to place their money in. Another gainer is the yen, which has been experiencing too much downfall because of the low exchange rate in dollars. On the other hand, the sudden boost in U.S. dollars has put a lot of pressure to the euros. In fact, for the two weeks that the dollar experiences some gains, euros have also fallen into the market.

Blame It on the Oil

The foreign currency market may have some relationship with oil prices. For example, while the drop of prices in oil has been particularly good for the United States and Japan forex traders because of the increase of their currency’s value, it may not be the exact condition for those who are trading in euros. In fact, it has experienced one of the session’s highs, around $1.2647 against the euro—up by 0.6 percent.

Limited Trading Capacities for Indonesia

On the other hand, rupiah, the official currency of Indonesia, continues to experience a slide of their money’s value that their central bank is already regulating the amount of foreign currencies that someone can purchase. Anyone who wants to buy some foreign currencies can only hold as much as $100,000. If they do have more than that, they have to offer underlying transactions. It takes effect on November 13.

With the new regulation, the financial sector and the government hopes that it will somehow provide a good balance between supply and demand in the foreign exchange market and prevent anyone from relying too much on speculation. It will also lessen the pressure on their currency.

Indonesia is currently adapting a free forex market system, where anyone is free to buy and sell currencies as long as they are following the rules and regulations when it comes to forex. Companies and even individuals can still buy other currencies, but before they can do so, they must present invoice for paying debts or goods importation. Unless they can present such, they are not allowed to purchase over $100,000.

With the new policy, moreover, the government will have more control on the free-flowing forex system in the country. Banks, for one, will be able to determine individuals who are doing speculative training. They will also conveniently manage the flow of hot money as it moves in and out of the country.