Rupiah Hits All-Time Low as US Dollar Surpasses Rp17,940
The Rupiah closed significantly lower against the US Dollar in Wednesday’s trading (3/6/2026), marking a new record low. According to Refinitiv data, the Indonesian currency closed at Rp17,940/US, breakingthroughthepsychologicalthresholdofRp17, 900/US and moving closer to the next psychological level of Rp18,000/US$.
The Rupiah faced pressure from the market opening, initially weakening 0.22% to Rp17,870/US$ before further depreciation occurred by the close. Conversely, the US Dollar Index (DXY), which measures the greenback’s strength against six major world currencies, was observed to strengthen, rising 0.05% to 99.271.
The Rupiah’s weakness was influenced by a combination of external and domestic sentiments. Externally, the strengthening of the US Dollar in global markets has limited the appreciation potential of other currencies, including the Rupisk. The US Dollar regained strength as tensions in the Gulf increased, driving demand for the greenback as a safe-haven asset. US Central Command reported that Iran launched ballistic missiles towards several countries in the Gulf region, although they failed to hit their targets, while US forces reportedly conducted strikes on Qeshm Island in response to attempted attacks from Tehran.
Domestically, pressure stemmed from weakening Indonesian trade performance. Data from the Central Bureau of Statistics (BPS) showed that the trade balance surplus for April 2026 fell sharply to approximately US$90 million, down from US$3.32 billion in March 2026. Cumulatively, Indonesia’s trade surplus for the January-April 2026 period also dropped from US$11.07 billion to US$5.64 billion.
Regarding the Rupiah’s depreciation, Bank Indonesia (BI) has ensured it will continue to monitor global and domestic financial market developments. “Bank Indonesia will continue to closely observe developments in global and domestic financial markets and will remain present in the market by taking necessary, consistent, and measured steps to maintain the stability of the Rupiah exchange rate and strengthen external resilience,” stated Ramdan Denny Prakoso, Head of the BI Communication Department, in a written statement. Ramdan assured that BI remains active in the market, optimising all available policy instruments to ensure proper market mechanisms and maintain sufficient foreign exchange liquidity to support financial market stability.
Furthermore, as of 2 June 2026, BI has implemented a threshold for cash purchases of foreign exchange against the Rupiah without underlying documentation, set at US$25,000 per participant per month. BI also continues to encourage the use of local currencies in bilateral cooperation through the Local Currency Transaction (LCT) scheme. This effort aims to reduce dependence on the US Dollar and mitigate exchange rate volatility risks. LCT cooperation has been established with several partners, including China, Japan, Malaysia, Thailand, South Korea, and the United Arab Emirates.