The Indonesian rupiah was at its strongest in four weeks after the country's central bank raised interest rates again on Wednesday — barely two weeks after another such hike.
Bank Indonesia, in a widely expected move, increased interest rates by 25 basis points in another attempt to curb the weakness in the rupiah. That followed an increase of the same magnitude on May 17, which did little to stop the currency from depreciating.
The rupiah has been one of the worst-hit Asian currencies this year as investors pulled out of the Indonesian stock and bond markets amid rising U.S. Treasury yields and strengthening in the greenback.
But Thursday morning saw the rupiah appreciate to 13,940 per U.S. dollar — its strongest since May 4. That was due to Bank Indonesia taking "a very decisive action," said Trinh Nguyen, senior economist for emerging Asia at Natixis.
"The new governor started out with a big bang: He had an unscheduled meeting and he's coming out saying, 'Listen, the stability of the rupiah is important to me, I'm willing to hike rates again.' It's the most aggressive central bank in Asia in following the Fed," Nguyen told CNBC's "Squawk Box" on Thursday.