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🇮🇩 Indonesia /Economy & Trade

Rupiah Weakens Past Rp 18,000 After Central Bank Governor's Resignation

From Republika · () Indonesian

Translated from Indonesian, summarized and contextualized by DistantNews.

At a glance

News Named sources New plan
  • The Indonesian Rupiah weakened past Rp 18,000 against the US dollar following the resignation of the central bank governor.
  • Investors are adopting a cautious "wait and see" approach, contributing to the currency's decline.
  • The central bank is expected to maintain its current policies to stabilize the Rupiah.

The Indonesian Rupiah experienced a significant decline, falling below Rp 18,000 against the US dollar, in the wake of the central bank governor Perry Warjiyo's resignation announcement on Monday, July 27, 2026. This development has triggered market volatility and prompted investors to adopt a cautious stance.

Economist Rahma from Airlangga University believes the Rupiah will continue to weaken due to investor hesitancy. "The announcement caused market participants concern about the continuity of monetary policy and short-term macroeconomic stability, thus encouraging a wait-and-see approach and selling pressure on domestic assets," Rahma explained. The Rupiah closed Monday, July 27, 2026, down 46 points or 0.26 percent at Rp 18,009 per US dollar. By Tuesday, July 28, 2026, it had further weakened to Rp 18,099 per US dollar.

The announcement caused market participants concern about the continuity of monetary policy and short-term macroeconomic stability, thus encouraging a wait-and-see approach and selling pressure on domestic assets.

— RahmaAn economist explains how the central bank governor's resignation impacted market sentiment and the Rupiah's value.

Rahma predicts the Rupiah's movement against the dollar on Tuesday will range between Rp 17,930 and Rp 18,100, influenced by market volatility stemming from domestic sentiment regarding the governor's resignation and anticipation of global macroeconomic data. "The pressure for further weakening will still be overshadowed by investor caution regarding the monetary policy transition under the Acting Governor of Bank Indonesia," she stated.

The pressure for further weakening will still be overshadowed by investor caution regarding the monetary policy transition under the Acting Governor of Bank Indonesia.

— RahmaAn economist discusses the ongoing impact of the leadership transition on the Rupiah's performance.

Despite the uncertainty, Rahma anticipates that Bank Indonesia (BI) will maintain its existing policies for managing the exchange rate and market. She noted that Senior Deputy Governor Destry Damayanti, appointed as Acting Governor, is an experienced figure within the central bank who understands market dynamics. "BI is expected to continue optimizing market intervention instruments, including spot transactions, Domestic Non-Deliverable Forwards (DNDF), and other monetary instruments, to curb volatility and prevent the Rupiah from moving outside its psychological levels," Rahma added.

The future movement of the Rupiah will largely depend on domestic dynamics, particularly the market's reaction to Perry Warjiyo's resignation and the consolidation steps taken by Destry Damayanti to ensure policy continuity and exchange rate stabilization.

BI is expected to continue optimizing market intervention instruments, including spot transactions, Domestic Non-Deliverable Forwards (DNDF), and other monetary instruments, to curb volatility and prevent the Rupiah from moving outside its psychological levels.

— RahmaAn economist outlines Bank Indonesia's expected strategies to manage the Rupiah's exchange rate.
DistantNews Editorial

Originally published by Republika in Indonesian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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