Indonesian Rupiah nears Rp18,000 per US Dollar

Indonesian Rupiah US Dollar Federal Reserve interest rates US Treasury yields currency depreciation

The Indonesian Rupiah is facing significant downward pressure, approaching the psychological level of Rp18,000 per US Dollar. Trading on Friday, September 25, 2026, saw the currency weaken to levels between Rp17,913 and Rp17,936 per USD.

Analysts attribute this depreciation to several external factors, primarily the strengthening US Dollar and rising US Treasury yields. These trends are driven by market expectations of tighter monetary policy from the Federal Reserve, with some economists anticipating potential interest rate hikes as early as October 2026 following strong US economic data.

Other contributing factors include rising global oil prices and geopolitical tensions in the Middle East, which have heightened inflation concerns and prompted investors to seek safe-haven assets. Domestically, investor sentiment has also been influenced by leadership changes within the Indonesian Ministry of Finance and ongoing discussions regarding fiscal discipline.