Rupiah Continues to Decline to Rp17,839 per US Dollar as Geopolitical Sentiment and Inflation Apply Pressure
The exchange rate of the Rupiah against the US Dollar closed weaker by 34 points, or 0.19 per cent, at Rp17,839 per US Dollar in trading on Tuesday, 2 June 2026.
Money market observer Ibrahim Assuaibi stated that the decline of the Garuda currency is still being influenced by global geopolitical uncertainty and the latest inflation data released by the Indonesian Central Statistics Agency (BPS). Additionally, the rise in global crude oil prices is exerting direct pressure on Indonesia’s foreign exchange requirements.
“From a domestic perspective, we see that the strengthening of global crude oil prices impacts domestic prices. We know that oil imports are so large, reaching up to 1.5 million barrels per day, which results in quite high demand for the US Dollar,” said Ibrahim, as reported by tvOnlenews.com on Tuesday (2/6/2026).
Regarding external factors, US President Donald Trump stated that talks with Iran are ongoing. This statement follows reports from the Tasnim news agency that Tehran has temporarily suspended indirect negotiations with Washington. While Trump initially suggested he would not be concerned if the talks failed, he later posted on social media reaffirming that the dialogue process with Iran remains active.
In an interview with ABC News, Trump also expressed hope for an agreement to extend the ceasefire and reopen the Strait of Hormuz within the coming week.
“Lebanon announced on Monday a partial ceasefire between Hezbollah and Israel, which will serve as a limited de-escalation of the conflict that has exacerbated the broader war with Iran,” Ibrahim explained, as quoted by Antara.
“Iran has effectively halted almost all non-Iranian shipments to and from the Gulf since the war began, choking approximately one-fifth of the global oil and liquefied natural gas flow and driving prices up by 50 per cent or more,” he added.
Alongside geopolitical developments, markets are also closely monitoring US trade policy. On Monday (1/6/2026), Trump signed a proclamation revising import tariffs on copper, aluminium, and iron, as announced by the White House. Under these regulations, import tariffs for certain agricultural equipment have been reduced from 25 per cent to 15 per cent.