Dollar Holders Take Note! BI Predicts Rupiah Will Strengthen

Jakarta, CNBC Indonesia - Bank Indonesia (BI) predicts that the rupiah exchange rate will experience strengthening over the medium to long term. Although it is currently under pressure, reaching the level of Rp17,100 per US dollar.

Head of the Monetary and Securities Assets Management Department at BI, Erwin Gunawan, explained that there are three indicators signalling the potential for the rupiah to strengthen in the future. He described these three indicators as measures of the fundamental health of the Garuda currency.

“From the three fundamental indicators that we assess and observe, the rupiah’s condition is good,” said Erwin at the Central Banking Forum 2026 CNBC Indonesia event on Monday (13/4/2026).

The first fundamental factor indicating that the rupiah is actually in a healthy condition is the current account deficit, which remains around 0.69%. “This is still within our tolerance limits,” Erwin stated.

Secondly, inflationary pressures are still within BI’s target range for the year, at 2.5% plus or minus 1%, with the latest figure of 3.48% released by the Central Statistics Agency (BPS) in March 2026.

Thirdly, foreign exchange reserves are currently around US$148.2 billion. This amount exceeds the global standard for covering six months of imports and government foreign debt payments.

“So from these three, the rupiah’s fundamentals are fine, even though we are not immune to global turbulence,” he emphasised.

Erwin said that the exchange rate pressures so far are still related to external risk factors, namely the war in the Middle East between the United States and Israel with Iran, which is not a fundamental issue.

“Thus, in the medium to long term, the rupiah has hope of an strengthening trend. We must be patient in observing the conflict,” Erwin remarked.