Indonesia’s rupiah forwards jumped the most since February and dollar bonds advanced as Joko Widodo said unofficial counts at polling booths showed him winning the presidential race.

Widodo, known locally as Jokowi, has 53.3 percent of support with 99.4 percent of votes counted, according to Lingkaran Survei Indonesia. Another unofficial tally by Saiful Mujani Research & Consulting had Jokowi on 52.9 percent based on 99 percent of votes counted. Both companies declared him the victor. His opponent, Prabowo Subianto, disputed those numbers, saying he was winning based on unofficial counts of survey companies used by his team.

One-month non-deliverable forwards traded offshore rose 1.4 percent to 11,583 per dollar from July 8 as of 8:22 p.m. in Singapore, according to data compiled by Bloomberg. That was the biggest increase since Feb. 14. The contracts have climbed 3.6 percent since July 3 amid speculation Jokowi was heading for a victory.

“The markets are holding to the view that Jokowi will be the eventual winner,” said Khoon Goh, a currency strategist at Australia & New Zealand Banking Group Ltd. in Singapore. “Prabowo’s challenge is more political posturing. He doesn’t want to concede at this stage, which is fair enough given the official result isn’t due until later this month.”

Indonesians will have to wait until July 21 or 22 for final results to be announced, and possibly until late August if there are legal challenges.

“I think the principle risk is just to push the certainty out further down the line,” said Steve Wilford, Asia-Pacific director of global risk analysis at Control Risks. If Prabowo chooses to mount a challenge, it could take months, he said.

Disputed Result
“All of us can be grateful that based on the quick counts up to now, Jokowi-JK are winning,” Jokowi told reporters in Jakarta, referring to his running mate Jusuf Kalla. “I ask all Indonesian people to preserve the people’s will and make sure no one tries to taint the aspirations of the people.”

Prabowo said that it looked like he had won based on “information that’s coming in from quick counts of various survey companies that we used as guidance.”

The yield on Indonesia’s 5.875 percent sovereign dollar bonds due 2024 fell four basis points to 4.30 percent, according to data compiled by Bloomberg. The yield has dropped 19 basis points, or 0.19 percentage point, this week.

The Jakarta Composite (JCI) index of shares advanced 2.4 percent in the last two days and the rupiah strengthened 2.1 percent.

Rally Seen
The Indonesian currency will probably rally toward 11,300 per dollar on a Jokowi victory, while a Prabowo win would see it decline toward 12,000, said Saktiandi Supaat, head of foreign-exchange research at Malayan Banking Bhd. in Singapore. The rupiah closed at 11,630 yesterday. A Jokowi victory has been mostly priced into the market, according to a research note by Brown Brothers Harriman & Co. analysts including Marc Chandler in New York.

“Most quick count results have put Jokowi in the lead and the markets have reacted likewise,” Wellian Wiranto, an economist at Oversea-Chinese Banking Corp. in Singapore, said by phone today.

The Jakarta share gauge will probably gain 3 percent to 4 percent over the next two to three days, said Mixo Das, an Asia ex-Japan equity strategist at Nomura Holdings Inc. in Hong Kong.

“After that it will depend on how things develop and whether Prabowo will challenge the results,” he said. Construction, property, cement and banking stocks would benefit the most from a Jokowi victory, he said.

Default Swaps
One-month implied volatility in the rupiah, a measure of expected swings in the currency used to price options, rose four basis points to 11.70 percent, data compiled by Bloomberg show. The gauge rose to 12.75 percent yesterday, the highest since Feb. 10.

The cost of protecting Indonesia’s sovereign debt against non-payment using five-year credit-default swaps fell to 144 basis points as of 3:47 p.m. in Singapore, according to Standard Chartered Plc prices, compared with 151 earlier today before the vote counting. The outcome of the election will have little impact on Indonesia’s
sovereign credit-rating, Standard & Poor’s said in a statement today. The reform process will be slow no matter who is elected, said S&P, which assigns Indonesia its highest junk ranking.

Expectations that Jokowi would cut red tape and corruption helped send the benchmark index of shares into a bull market in March when he joined the race. Pledges by Prabowo, a former general and once son-in-law of the dictator Suharto, to borrow heavily and renegotiate contracts with foreign companies alarmed some investors.

Slowing Economy
Both candidates campaigned on populist platforms to spur growth, reduce poverty, build infrastructure and help farmers. They promised to keep the export ban in place and neither mentioned fuel subsidies in the final leaders’ debate.

“Long term the Jokowi victory is positive for Indonesia,” said Joshua Tanja, head of research at PT UBS Securities Indonesia. “It is positive for the infrastructure sector and anything to do with social welfare such as health care.”

Indonesia’s new president will inherit an economy that grew at the slowest pace since 2009 last quarter. Exports have fallen in four of the first five months of the year following a partial ban on the export of mineral ores that started in January, while costly fuel subsidies make government finances vulnerable to increases in global oil prices. The cost of crude in New York has climbed 4.9 percent this year amid concern fighting in Iraq would curb shipments from the nation.

“While the quick counts should be treated with caution, early indications that Widodo has squeaked past Subianto will be greeted positively by markets,” Nicholas Spiro, managing director of Spiro Sovereign Strategy in London, said in e-mailed comments today. “From a market standpoint, it would obviously be more preferable if Widodo’s margin of victory was significantly wider. A divided nation is the worst possible outcome as far as the politics of reform are concerned.”

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