Jakarta, CNBC Indonesia - DBS Bank Indonesia projects the rupiah\nexchange rate against the US dollar will sit in the range of Rp17,800 to\nRp18,000 by the end of this year.<\/p>\n
Senior Economist at DBS Bank, Radhika Rao, said the forecast could be\nrevised, depending on the interest rate policy decisions of the US\ncentral bank, the Federal Reserve (The Fed).<\/p>\n
However, Rao believes that, in terms of direction, the rupiah will\nremain above the 18,000 level. According to her, there is no reason for\nanother sharp weakening of the rupiah against the US dollar.<\/p>\n
\u201cBecause most of the uncertainty, both on growth and domestically, is\nalready reflected in prices. So, we have already seen some adjustment\ntake place,\u201d Rao said at the DBS Institutional Forum 2026 Media Briefing\nat the Westin Hotel Jakarta on Wednesday (29\/7\/2026).<\/p>\n
For a sharp depreciation of the rupiah to occur, at least two to\nthree negative catalysts would be needed. Rao said the only potential\nnegative catalyst at present comes from global factors, namely the\ndirection of The Fed\u2019s policy.<\/p>\n
Regarding the potential revival of the rupiah, she said risk\nsentiment remains very elevated. Rao said foreign investors are\ncurrently holding back from investing anywhere.<\/p>\n
\u201cSo, if they decide to invest in, say, Indonesia, or they decide to\ninvest in Korea, the comparison is no longer between Asian countries and\ndeveloping countries. The comparison is between individual countries,\ndeveloping countries, and global ones,\u201d she explained.<\/p>\n
This is because, Rao said, if the US risk-free yield is in the region\nof 4.5%-4.6%, there is a differential of around 2%-2.5% with the yield\non Indonesian assets. She questioned whether that differential is\nsufficient to compensate for the risk of investing in Indonesia.<\/p>\n
Rao views the rupiah\u2019s return to Rp17,000 per US dollar as dependent\non the movement of the greenback\u2019s exchange rate. This is reflected in\nhow the US dollar is currently strengthening against nearly all world\ncurrencies.<\/p>\n
\u201cYou really need a very, very sharp reaction in the dollar itself to\nbring dollar-rupiah towards Rp17,000,\u201d Rao said.<\/p>\n
Furthermore, Rao assessed that the policy for stabilising the rupiah\nand the financial markets has been appropriate. This includes Bank\nIndonesia\u2019s (BI) decision to raise its benchmark interest rate (BI Rate)\nby 100 basis points over the course of this year.<\/p>\n
\u201cThey have also taken non-interest-rate steps. All of this has really\ncontributed to the stabilisation of the financial markets and the bond\nmarket, so I think the prescription is right,\u201d Rao concluded.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/foreign-bank-economist-reveals-when-us-dollar-could-return-to-rp17-000-us-1785336759", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }