Finance Minister Purbaya: Rupiah Weakness 'Unreasonable'

The rupiah faced renewed pressure against the US dollar on Thursday, May 28, 2026, with Bloomberg data showing it weakened to Rp 17,858 per dollar in morning trade. Amid the pressure, Finance Minister Purbaya Yudhi Sadewa stated that the rupiah’s weakness does not align with Indonesia’s economic fundamentals. He argued that the domestic economy remains strong, making the pressure on the currency ‘unreasonable’. ‘This is happening when fundamentals are good. It doesn’t make sense. Typically, weakness occurs when there are disruptions to economic fundamentals,’ Purbaya said in Jakarta. Purbaya explained that the government, along with other parties, has taken steps in the government securities (SBN) market to keep bond yields under control. He said stable bond markets are crucial for maintaining investor confidence. ‘Even as the rupiah weakens, bond yields have fallen due to government and market participants’ buying efforts to stabilise yields,’ he added. He also noted that foreign capital inflows into domestic financial markets have started to return, making the rupiah’s weakness inconsistent with national economic conditions. ‘We’ve started seeing foreign capital entering our public markets. This is illogical given the fundamentals,’ said the former chairman of the Deposit Insurance Agency (LPS). Meanwhile, economist Yanuar Rizky warned that bond market interventions could add further pressure on the rupiah if reliance on foreign capital remains high. ‘If SBN interventions aim to maintain yields while global yields fall, liquidity theory suggests the rupiah could weaken further,’ he said.