Rupiah Extends Losing Streak Despite Dollar Weakness
The Indonesian rupiah weakened past IDR 18,100 per U.S. dollar on Monday, falling for a fourth consecutive session and reaching its lowest level since late July. Domestic pressures continued to weigh on sentiment, with oil prices above USD 100 per barrel raising concerns over fiscal strain given Indonesia’s status as a net oil importer. Inflationary risks also persisted amid rising food prices linked to El Niño. Meanwhile, Bank Indonesia’s latest policy adjustments drew criticism from some market participants for their complexity, as the central bank held its benchmark rate unchanged while raising the deposit facility rate and cutting the reserve requirement ratio (RRR). BI officials said the measures were intended to align interest rates with monetary operations following the government’s placement of funds in commercial banks. The rupiah’s decline came despite a further pullback in the U.S. dollar index, as traders cautiously awaited the Fed’s policy decision later this week.
The Indonesian rupiah weakened past IDR 18,100 per U.S. dollar on Monday, falling for a fourth consecutive session and reaching its lowest level since late July. Domestic pressures continued to weigh on sentiment, with oil prices above USD 100 per barrel raising concerns over fiscal strain given Indonesia’s status as a net oil importer. Inflationary risks also persisted amid rising food prices linked to El Niño.
Meanwhile, Bank Indonesia’s latest policy adjustments drew criticism from some market participants for their complexity, as the central bank held its benchmark rate unchanged while raising the deposit facility rate and cutting the reserve requirement ratio (RRR). BI officials said the measures were intended to align interest rates with monetary operations following the government’s placement of funds in commercial banks. The rupiah’s decline came despite a further pullback in the U.S. dollar index, as traders cautiously awaited the Fed’s policy decision later this week.