Economic Growth Projected to Slow, Rupiah Weakens to Rp 18,111 per US Dollar

The rupiah exchange rate against the US dollar continued its downward trend, remaining above the Rp 18,000 level. The weakening of the Indonesian currency occurred alongside projections of slowing economic growth in the second quarter of 2026.

Citing Bloomberg data, the rupiah weakened by 38 points, or 0.21 percent, to close at Rp 18,111 per US dollar on Thursday (30/7/2026). The rupiah breached the Rp 18,000 mark again following the announcement of Bank Indonesia Governor Perry Warjiyo’s resignation earlier in the week.

Currency and commodity analyst Ibrahim Assuaibi stated that economists project economic growth in the second quarter of 2026 to be in the range of 4.8 percent to 4.9 percent. This projection is significantly lower than the economic growth recorded in the first quarter of 2026, which reached 5.61 percent.

The projected slowdown is attributed to pressures from high production costs due to global turmoil, monetary policy tightening, and domestic fiscal governance uncertainty. He added that economic growth for the full year 2026 is predicted to be in the range of 4.9 percent to 5.1 percent, below the government’s target of 5.4 percent. S&P projects Indonesia’s economic growth to be around 5 percent for the 2027 to 2029 period.

Ibrahim noted that the market is also observing uncertainty regarding the succession of the central bank’s leadership following Perry Warjiyo’s resignation, regional fiscal pressures, and obstacles to mineral exports. Market participants are also preparing for the release of several key domestic data points next week, including July inflation figures, May trade data, foreign exchange reserves, second-quarter gross domestic product, and the Consumer Confidence Index.