Rupiah Nears Record Low Amid Dollar Strength and Political Uncertainty
The Indonesian rupiah hovered near IDR 18,250 per U.S. dollar on Thursday, approaching its record low of IDR 18,279 as losses extended into a second session. The currency remained under pressure from a stronger U.S. dollar, which hit its highest level since April 2025 following hotter-than-expected October inflation. Locally, traders monitored political turmoil after Vice President Gibran Rakabuming submitted his resignation following a Supreme Court ruling on his high-school diploma credentials, prompting calls for parliamentary impeachment. Foreign outflow risks also mounted ahead of MSCI’s November review of Indonesia’s equity market. Meanwhile, Bank Indonesia continued intervening in currency markets to support the rupiah ahead of next week’s policy meeting. However, concerns persisted over the trade-off between currency stability and growth after the central bank held interest rates steady for a fourth month in October, following cumulative hikes of 100bps in May and June.
The Indonesian rupiah hovered near IDR 18,250 per U.S. dollar on Thursday, approaching its record low of IDR 18,279 as losses extended into a second session. The currency remained under pressure from a stronger U.S. dollar, which hit its highest level since April 2025 following hotter-than-expected October inflation.
Locally, traders monitored political turmoil after Vice President Gibran Rakabuming submitted his resignation following a Supreme Court ruling on his high-school diploma credentials, prompting calls for parliamentary impeachment. Foreign outflow risks also mounted ahead of MSCI’s November review of Indonesia’s equity market. Meanwhile, Bank Indonesia continued intervening in currency markets to support the rupiah ahead of next week’s policy meeting. However, concerns persisted over the trade-off between currency stability and growth after the central bank held interest rates steady for a fourth month in October, following cumulative hikes of 100bps in May and June.