IMF Speaks Frankly on the US Dollar and the Fate of Currencies Worldwide
The value of the US dollar is currently strengthening against various other countries’ currencies, including the rupiah, due to economic uncertainty stemming from the war between US President Donald Trump and Iran in the Middle East region.
However, this strengthening is now considered more moderate compared to previous crisis periods, according to the IMF’s Economic Counsellor and Research Director Pierre-Olivier Gourinchas during the IMF Spring Meetings media briefing, quoted on Wednesday (15/4/2026).
“This is what we have observed following the conflict in the Middle East region. The dollar’s strengthening is moderate compared to historical standards, but it remains an appreciation,” he said.
Gourinchas explained that typically, when global economic uncertainty arises or risk-off sentiment emerges among financial market participants, investors seek safer assets.
They shift their portfolios to instruments deemed safer, such as US government bonds (U.S. Treasuries) or similar. This movement is generally associated with a strengthening of the dollar’s value.
This is the situation occurring now, reflected in the US dollar index level (DXY), which measures its strength against six major world currencies, rising since the conflict erupted between the US-Israel and Iran at the end of February 2026.
Although the current dollar strengthening is more moderate than in previous crises, Gourinchas warns that its effects on inflationary pressures and debt burdens remain highly risky. Therefore, he stresses the importance of diversification.
“This appreciation then creates inflationary pressure in other countries, because from their perspective, there is domestic currency depreciation. Additionally, this tightens financial conditions, given that many of those countries have obligations denominated in dollars,” said Gourinchas.
Referring to Refinitiv data, as of today, the DXY is indeed stable compared to the previous trading day’s close. Up to the data viewed at 12:00 WIB, the DXY is at 98.16, while yesterday it closed at 98.12.
The highest DXY level occurred on 30 March 2026 at 100.51. During the US-Israel attack on Iran on 28 February 2026, the DXY also moved in a range similar to the current level. The initial surge happened on 2 March 2026 to 98.38, from the 27 February 2026 position of 97.61.