Purbaya Denies Rupiah Weakening Mirrors 1998 Economic Crisis, Outlines Key Differences

Jakarta, VIVA – Finance Minister Purbaya Yudhi Sadewa has denied that the current trend of rupiah depreciation is similar to the conditions experienced during Indonesia’s economic crisis in the mid-1997-1998 period. He asserted that the foundations of the national economy remain very strong, differing significantly from the economic conditions and political instability of that era.

“If the rupiah weakens, it might seem as though we are moving towards another 1998 situation, but it is different,” said Purbaya in the Lanud Halim Perdanakusuma area, East Jakarta, on Monday, 18 May 2026. “In 1998, policies were incorrect, and there was socio-political instability that occurred after a year of recession.”

He explained that the economic crisis at that time began with an economic recession in mid-1997, and the subsequent socio-political instability in 1998 ultimately triggered the monetary crisis. In contrast, Purbaya emphasised that the current situation is far from that period, as the national economy is still capable of high growth, and the government maintains significant room to improve macro indicators affected by global market volatility.

He added that fluctuations in the financial markets are short-term sentiments that will soon recover because the national economic foundation remains strong. “It is fine; we will rectify it. The economic foundation is good right now. This is a matter of short-term sentiment,” said Purbaya.

Regarding the weakening of the rupiah, which stood at Rp 17,658 per US dollar in this morning’s trading, Purbaya expressed hope that market participants would not be excessively worried. He noted that the pressure tends to be caused by short-term sentiment. He assured that the government will remain focused on maintaining economic fundamentals to ensure national growth remains steady and undisturbed by financial market volatility. “My focus is on guarding the economic foundation by ensuring economic growth is not disrupted,” he concluded.