Rupiah Closes Stronger, US Dollar at Rp17,945

The rupiah exchange rate managed to close stronger against the United States dollar in the final trading session of the week, Friday (3/7/2026). Referring to Refinitiv data, the Garuda currency ended in positive territory, strengthening 0.24% to the level of Rp17,945 per US dollar. This appreciation simultaneously broke the rupiah’s weakening trend over the previous three consecutive trading days. Throughout today’s trading, the rupiah moved in the range of Rp17,935 to Rp17,965 per US dollar. The rupiah’s strengthening was visible from the start of morning trading, in line with the weakening of the US dollar in global markets. Meanwhile, the US dollar index (DXY), which measures the greenback’s strength against six major world currencies, was observed weakening 0.13% to 100.725 as of 15.00 WIB. The rupiah’s strengthening today was mainly influenced by external factors, namely the weakening of the US dollar in global markets. The greenback weakened this afternoon, continuing a sharp correction from the previous trading session. The DXY previously closed down 0.53%, amid easing market expectations regarding the likelihood of a near-term interest rate hike by the US central bank, the Federal Reserve. The weakening of the US dollar indicates that selling pressure on greenback-denominated assets is beginning to increase. This condition opens more room for appreciation for other countries’ currencies, including the rupiah. Pressure on the US dollar emerged after US labour data showed signs of cooling. US job growth in June was recorded as slowing more than expected, while payroll increases for the two previous months were also revised lower. Throughout June, the US economy added only 57,000 jobs, far below the market expectation of 110,000 jobs. The weaker labour data prompted the market to reassess the chances of a Fed rate hike for the remainder of the year. This ultimately pressured the US dollar and provided room for the rupiah to strengthen. Meanwhile, Trimegah Sekuritas Indonesia Chief Economist Fakhrul Fulvian assessed that the rupiah’s current movement needs to be viewed as part of a financial market adjustment process, not merely as a reflection of deteriorating Indonesian economic fundamentals. ‘In my view, we are starting to see positive signals. Foreign investors have returned to the government bond market in recent times. This shows that the market is beginning to appreciate the change in policy direction undertaken by the authorities, especially in liquidity management and efforts to restore a healthier price formation mechanism in the bond market,’ said Fakhrul. According to Fakhrul, the rupiah stabilisation process does not happen instantly. The bond market is one of the important factors because it is the main entry point for foreign portfolio capital flows. ‘The rupiah is essentially waiting for larger capital inflows. To generate sustainable capital inflows, the Indonesian bond market needs to offer a sufficiently attractive yield compared to the still-high global risks,’ said Fakhrul. He added that Indonesia has currently moved from a pressure phase towards a stabilisation phase. However, this process still requires policy consistency so that foreign capital flows into the government bond market can strengthen further.