BI Says Pressure on Rupiah to Rp 17,500 Due to Combination of Global and Domestic Factors

Jakarta – Bank Indonesia (BI) has finally spoken out on the causes of the increasing pressure on the rupiah exchange rate, which today reached its all-time high level of Rp 17,500 per US dollar.

BI Senior Deputy Governor Destry Damayanti explained that the pressure on the rupiah exchange rate is influenced, among other things, by a combination of global and domestic factors.

Globally, the increasing intensity of conflicts in the Middle East, which is driving up oil prices and global uncertainty, has contributed to pressuring the rupiah exchange rate.

Meanwhile, on the domestic side, the seasonal increase in US dollar needs, such as for external debt payments (ULN), dividends, and Hajj pilgrimage requirements, has boosted foreign exchange demand in the domestic market and worsened the pressure on the rupiah.

“BI will continue to commit to always being in the market, by carrying out smart interventions, both in the spot market, DNDF, and NDF,” said Destry in her statement on Tuesday, 12 May 2026.

“Also by optimising the use of all monetary operation instruments, so that it is hoped this can reduce the pressure on the rupiah,” she added.

Nevertheless, she assured that foreign investor confidence in domestic portfolio assets continues to improve.

This can be seen, for example, from the capital inflows into the State Securities (SBN) market and Bank Indonesia Rupiah Securities (SRBI), which reached Rp 61.6 trillion throughout April 2026.

In addition, foreign exchange liquidity in the domestic market remains adequate, as reflected in the 10.9 percent growth in third-party funds (DPK) in foreign currency year-to-date as of the end of March 2026.

“BI estimates that this seasonal pressure will subside so that the rupiah exchange rate can return to its fundamental level,” she said.