Rupiah Approaches Rp18,000 Level, Here Are the Triggers

The exchange rate of the rupiah against the US dollar weakened by 45 points or 0.25 per cent at the opening of trading on Monday, reaching Rp17,948 per US dollar compared to the previous close of Rp17,903 per US dollar.

Lukman Leong, an analyst at Doo Financial, stated that the rupiah’s depreciation was influenced by US durable goods sales data being stronger than anticipated. “The rupiah is expected to weaken against the US dollar amidst rising US bond yields, global crude oil prices, and the prospect of Federal Reserve interest rate hikes following stronger US economic data (durable goods sales), as well as the US rejection of Iran’s proposal,” he said in Jakarta on Monday.

It was noted that US durable goods sales remained unchanged at 0 per cent, yet this was higher than the projected decline of 0.4 per cent. Consequently, as reported by Xinhua, new orders for US-made durable goods in August remained stable at $338.6 billion.

Furthermore, Anadolu reported that US President Donald Trump rejected the latest proposal from Iran presented to Washington during indirect negotiations in New York this week. Tehran had proposed the reopening of strategic waterways and the resumption of nuclear talks within one week, in exchange for the lifting of the Washington naval blockade, the removal of sanctions on Iranian oil sales, and the restoration of a regional ceasefire.

The US is reportedly considering new strikes following the US mid-term elections in November 2026. Based on these factors, US 10-year bond yields stood at 5.2 per cent and 30-year yields at 5.52 per cent.

Meanwhile, West Texas Intermediate (WTI) crude oil prices were in the range of $94.15 per barrel, and Brent stood at $103.2 per barrel.

Investors are also closely monitoring the prospects of a more hawkish Federal Reserve policy. According to the CME FedWatch tool, market participants now estimate approximately a 70 per cent chance of a quarter-point interest rate hike at the Fed’s October meeting, up from 50 per cent at the start of the week.

This shift is driven by strong economic data and hawkish comments from policymakers, which have reinforced expectations that interest rates may remain high for a longer period.

Referring to the aforementioned sentiments, Lukman predicts the rupiah will move within the range of Rp17,900–Rp18,000 per US dollar.