Indonesia's rupiah traded near the highest in more than a week on speculation inflation may have peaked after oil prices held close to the lowest since June 4. Government bonds advanced.

The currency is heading for its second monthly gain as the central bank raised its benchmark interest rate three times this year after inflation quickened in June to the most in 21 months. Oil declined almost $7 a barrel in three days, easing import costs for Indonesia, which imports a third of its fuel needs.

``Oil prices traded at $125 to $130 for the last week, it makes the inflation pressure less,'' said Rio Lanasier, a currency trader at Bank DBS Indonesia in Jakarta. ``The rupiah will be stable, strengthening preferably to 9,130'' today.

The currency rose 0.1 percent to 9,132 against the U.S. dollar as of 12:45 p.m. in Jakarta, compared with 9,143 yesterday, according to data compiled by Bloomberg.

The rupiah has gained 1 percent since May 6, when Bank Indonesia began increasing its reference rate for bill sales from 8 percent. The rupiah was the best performing currency in Southeast Asia over that period.

Inflation may have reached 11.1 percent this month, little changed from 11 percent in June, according to the median estimate of eight economists and analysts in a Bloomberg News survey. The Central Bureau Statistics in Jakarta will report the inflation data on Aug. 1.

Ten-year notes rose for a fifth day, pushing yields to the lowest in more than three months.

The yield on the 9 percent note due September 2018 fell 30 basis points to 11.963 percent, according to midday prices by Inter Dealer Market Association. The price advanced 1.499, or 14,990 rupiah per 1 million rupiah face amount, to 82.839. A basis point is 0.01 percentage point.