Bank Indonesia Governor Speaks Candidly on Causes of Recent Rupiah Weakening
Jakarta, VIVA – Bank Indonesia (BI) Governor Perry Warjiyo disclosed that the rupiah exchange rate on Wednesday, 18 February 2026, stood at Rp 16,880 per US dollar. This represented a depreciation of 0.56 per cent on a point-to-point basis compared with its level at the end of January 2026.
Perry affirmed BI’s commitment to continuing efforts to strengthen its rupiah exchange rate stabilisation policy, which has been negatively affected by widespread uncertainty in global financial markets.
According to Perry, this uncertainty has been one of the key factors triggering the rupiah’s weakening trend against the US dollar, compounded by a surge in foreign currency demand from domestic corporations related to their business activities.
“The exchange rate depreciation has primarily been driven by heightened global financial market uncertainty, alongside increasing foreign currency demand from domestic corporations in line with rising economic activity,” Perry said during a press teleconference on Thursday, 19 February 2026.
On the other hand, Perry acknowledged the prevailing perception that the rupiah is undervalued relative to the actual fundamentals of Indonesia’s economy at present.
This also encompasses consistency with inflation control measures targeting the 2.5 per cent ± 1 per cent band for 2026 and 2027. Consequently, Perry continued, BI will continue striving to intensify its rupiah exchange rate stabilisation through a range of measures.
These include intervention in the offshore Non-Deliverable Forward (NDF) market and spot transactions, as well as Domestic Non-Deliverable Forward (DNDF) operations in the onshore market.
Looking ahead, Perry said BI views and is confident that the rupiah exchange rate will return to stability and tend to strengthen, supported by the various stabilisation measures the central bank will continue to implement.
“This is naturally underpinned by Indonesia’s sound economic fundamentals, reflected in attractive yields, low inflation, and continuously improving economic growth prospects,” he said.