Rupiah slips to Rp17,646 per dollar as foreign reserves rise

The rupiah opened Monday weaker at Rp17,646 per U.S. dollar, down four points, or 0.02 percent, from its previous close of Rp17,642. Market observers attributed the move partly to rising geopolitical tensions in the Middle East.

Money-market analyst Ibrahim Assuaibi said the tensions had lifted the U.S. dollar index and crude oil prices, putting pressure on the Indonesian currency. West Texas Intermediate crude stood at about $91.92 a barrel, while Brent crude traded around $96.55.

“

Demand for oil imports at higher prices means the government has to prepare a large amount of dollars. So it is reasonable that the rupiah weakened in morning trading.

Higher oil prices could increase Indonesia’s need for foreign currency to pay for imports, Ibrahim said. “Demand for oil imports at higher prices means the government has to prepare a large amount of dollars. So it is reasonable that the rupiah weakened in morning trading,” he said.

“

Although it is not very significant, it has implications for Indonesia’s economy. We can see that flights from Sept. 6 to Sept. 7 are still closed.

Ibrahim also pointed to activity at Mount Anak Krakatau, saying it had affected economic activity through flight disruptions. “Although it is not very significant, it has implications for Indonesia’s economy. We can see that flights from Sept. 6 to Sept. 7 are still closed,” he said. Traders were also awaiting domestic data on foreign-exchange reserves, retail sales and consumer confidence.

Permata Bank Chief Economist Josua Pardede said stronger-than-expected U.S. employment data had increased the likelihood of a Federal Reserve policy rate hike at its September 2026 meeting. U.S. nonfarm payrolls rose by 162,000 in August, exceeding the 55,000 market forecast and the revised July figure of 21,000. The unemployment rate remained at 4.1 percent. Josua said market pricing for a rate increase had risen to about 60 percent from 50 percent, supporting the dollar. He forecast the rupiah would trade between Rp17,600 and Rp17,725 on Monday.

“

The stronger-than-expected U.S. employment data increased market expectations, reflected in pricing, for a policy rate increase to about 60 percent from about 50 percent, supporting the strengthening of the U.S. dollar.