Basic Foodstuff Prices Could Rise Due to Rupiah Weakness

Today, Friday (27/3/2026), the rupiah exchange rate reached Rp16,967 per US dollar. The weakening of the rupiah signals an imbalance in Indonesia’s economy, triggering a rise in basic foodstuff prices between 2-8%. This is because Indonesia still relies on imports for some food ingredients that are difficult to replace. “This exchange rate fluctuation will affect food price stability, varying from 2 to 8% depending on the type of food,” explained Hani Perwitasari, Lecturer in Agricultural Social Economics at Universitas Gadjah Mada (UGM), quoted from Kompas.com on Friday (27/3/2026). If exchange rate changes continue to pressure the rupiah, the increase will occur more quickly. “The most vulnerable commodities are meat, then eggs and milk, which are difficult to substitute, making them more susceptible to the impact of the rupiah’s weakening,” she said. Import volume becomes irrelevant if the rupiah’s weakening persists, as it is highly vulnerable to exchange rate volatility. However, the government must still open the tap for food imports because domestic production is insufficient. “The higher the imports, the more vulnerable it will be to existing exchange rate fluctuations,” said Hani. Of course, with the caveat that products must meet consumer standards. “The role of all parties, including consumers, is important, as choosing domestic products will encourage the strengthening of national food production,” said Hani. Since 23 March 2026, the rupiah exchange rate against the US dollar has continuously weakened. The reason is the escalation in the Middle East, which has caused several currencies to weaken against the US dollar. Quoted from Kompas.id, exchange rate depreciation is also experienced by currencies of developed countries, such as the euro, Japanese yen, and British pound sterling. This weakening is primarily caused by the strengthening of the US dollar exchange rate since geopolitical tensions in the Middle East. It is suspected that the rupiah will remain in the range of Rp16,900-17,000 per US dollar if the tensions in the Middle East do not resolve soon.