JAKARTA – The rupiah exchange rate against the US dollar at the opening of trading on Wednesday, moved up 27 points or 0.15 percent to Rp17,857 per US dollar compared to the previous closing at the level of Rp17,884 per US dollar.
Bank Woori analyst Saudara Rully Nova said the strengthening of the rupiah was influenced by the potential of Bank Indonesia (BI) to hold interest rates in today’s Governor’s Council Meeting (RDG).
“The rupiah today is expected to strengthen in the range of Rp. 17,830-Rp. 17,880 influenced by domestic results of the RDG BI decision today which is expected to hold the benchmark interest rate at 5.75 percent,” he told ANTARA in Jakarta, Wednesday.
A number of economists have projected the benchmark interest rate (BI-Rate) to remain at 5.75 percent at the September 2026 BI RDG, with the possibility of an increase at the end of the year if external pressures become more persistent.
Escalating conflicts in the Middle East and the Russia-Ukraine war have prompted several central banks to review their monetary policy stance, including the Fed, the European Central Bank, and the Bank of Japan.
On the other hand, the Fed has also indicated that further rate hikes could still be an option this year, even though U.S. labor market conditions remain relatively strong.
Overall, global pressure mainly comes from a combination of the Fed’s more hawkish policies, a strengthening US dollar, geopolitical uncertainty, and high oil prices.
According to Rully, BI today will show a hawkish attitude to maintain rupiah stability through the expansion of instruments such as Bank Indonesia Rupiah Securities (SRBI), spot foreign exchange market, to Non-Deliverable Forward (NDF) derivatives and swaps.
“Globally, oil prices show a downward trend, pushing down the dollar index and US government bond yields,” he said.
The English, Chinese, Japanese, Arabic, and French versions are automatically generated by the AI. So there may still be inaccuracies in translating, please always see Indonesian as our main language.
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