Protecting the Rupiah in Line with Fundamentals, Bank Indonesia Ready to Intervene in Markets
JAKARTA – Bank Indonesia (BI) has confirmed it will continue to maintain the stability of the rupiah’s exchange rate in line with its fundamentals amid escalating geopolitical conflict in the Middle East.
Erwin Gunawan Hutapea, Head of the Monetary Management and Securities Assets Department at BI, stated that the ongoing conflict in Iran could drive risk-off sentiment in global financial markets.
As a result, the central bank continues to closely monitor market movements in order to respond appropriately and swiftly.
“This includes ensuring the rupiah’s exchange rate moves in accordance with its fundamentals,” said Erwin in a written statement to media on Monday (2 March 2026).
BI’s interventions to stabilise the rupiah will include Non-Deliverable Forward (NDF) transactions in foreign markets as well as spot transactions and Domestic Non-Deliverable Forward (DNDF) transactions in the domestic market. This strategy is accompanied by purchases of government securities (SBN) in the secondary market.
Additionally, BI will continue to strengthen the effectiveness of the transmission of monetary policy easing and macroprudential policies that have been implemented to date.
This will be done by carefully monitoring the scope for further reductions in the benchmark interest rate (BI Rate) in line with inflation forecasts for 2026-2027 that remain controlled within the target range of 1.5-3.5 per cent, and efforts to support stronger economic growth.
“BI will also continue to optimise policies to improve the effectiveness of interest rate policy transmission,” he added.
Chief Analyst at Doo Financial Futures Lukman Leong forecasts the rupiah’s exchange rate will trade within the range of Rp 16,750-16,900 per US dollar in today’s trading on Monday (2 March 2026). However, he does not rule out the possibility that the rupiah could weaken to the level of Rp 17,000 this week.
Nevertheless, according to Lukman, the rupiah has the potential not to weaken significantly because he expects Bank Indonesia (BI) will intervene in the money market.
Similar predictions have also been made by Currency and Commodities Analyst Ibrahim Assuaibi.
For information, at the close of trading last Friday (27 February 2026), the rupiah closed weaker by 0.17 per cent at the level of Rp 16,787 per US dollar.
At the opening of trading this morning on Monday, the rupiah moved weaker by 0.24 per cent or 41 basis points against the US dollar to the level of Rp 16,828 per US dollar.