Asian Currencies Suffer, Including Rupiah, Except Yen-Won
Jakarta, CNBC Indonesia - The rupiah continues to face pressure against the US dollar, making the currency of Uncle Sam’s country increasingly dominant amid the unrelenting turmoil of the Middle East war.
According to Refinitiv, on Friday (1/5/2026), the rupiah closed 0.17% weaker at Rp17,305/US$. Meanwhile, over the course of this week, the rupiah remained in the doldrums, weakening 0.67% on a point-to-point basis.
Among Asian currencies, the rupiah was the third worst performer, after the Philippine peso and Indian rupee, which corrected by 0.99% and 0.69% respectively over the week.
The Japanese yen was the strongest over the week, surging 1.47%, followed by the South Korean won which strengthened 0.37%.
This week’s Asian currency movements were still influenced by US dollar dynamics in the global market, although the US dollar was observed to weaken 0.38% over the week, as seen from the DXY index. However, in Friday’s trading, the DXY index strengthened 0.16% to 98.21.
The dynamics of US dollar movements occurred after the US central bank (Federal Reserve/The Fed) decided to hold interest rates again, leading the market to scrutinise the future direction of US monetary policy more closely, especially after the meeting showed quite sharp differences of opinion within The Fed.
The Fed’s decision this time was taken by a vote of 8 to 4, making it the most divided decision since 1992.
This situation opens up challenges that Kevin Warsh will face when he later serves as Fed Chairman, especially if he wants to push for interest rate cuts. Jerome Powell’s term as Fed Chairman ends on 15 May.
In a press conference, Powell stated that although four Fed officials rejected maintaining the easing bias, he does not see the US central bank heading towards rate hikes.
In addition to the Fed factor, the market is still overshadowed by the US-Israel war with Iran, which shows no signs of abating. This uncertainty also keeps demand for the US dollar high as a safe-haven asset.
US President Donald Trump is reported to have discussed ways to mitigate the impact of a potential Iranian port blockade for several months with US oil companies. This situation has reignited concerns over global energy supplies.