Purbaya Optimistic Rupiah Will Strengthen Gradually in Second Half of 2026

The government is confident that the rupiah exchange rate will gradually strengthen again in the second half of 2026. Finance Minister Purbaya Yudhi Sadewa stated that pressure on the rupiah through early June was primarily influenced by global sentiment, risk-off conditions in financial markets, and pressures from the current account and domestic financial transactions. “Nevertheless, the government is optimistic that the rupiah will gradually strengthen in the second half of 2026,” Purbaya said during a working meeting with the Indonesian House of Representatives at the Parliament Complex in Senayan, Jakarta, on Wednesday. This optimism is based on more solid synergy and coordination between fiscal, monetary, and financial sector policies. It also rests on improved governance of export proceeds, financial market deepening that will strengthen the domestic foreign exchange supply, and improved investor confidence. “Amid pressure on the rupiah exchange rate, the government continues to strengthen coordination between fiscal and monetary policies to maintain stability while preserving growth momentum. The hope is to increase market confidence so that it will strengthen the domestic foreign exchange supply, including through the recently revised export proceeds policy,” Purbaya said. For 2027, the finance minister noted that geopolitical conflicts, particularly between Iran and the United States-Israel, are expected to ease further and global economic growth is forecast to improve. “With these various considerations, the government estimates the rupiah in 2027 will remain stable in the range of Rp16,800 to Rp17,500 per US dollar,” the state treasurer stated. With the right economic strategy and prudent, sustainable fiscal policy, the government is also optimistic that the Indonesian economy in 2027 can grow strongly in the range of 5.8 percent to 6.5 percent. “This will be a strong foundation towards 8 percent growth in the medium term,” he explained. Meanwhile, inflation is under control in the range of 1.5 percent to 3.5 percent, and the 10-year government bond yield is expected to be in the range of 6.5 percent to 7.3 percent.