Rupiah Opens Weak, US Dollar Approaches Rp18,000 Again

The rupiah exchange rate opened weaker against the United States dollar at the start of trading this week, Monday (6/7/2026). According to Refinitiv data, the Garuda currency opened sluggish this morning, weakening 0.12% to the level of Rp17,970 per US dollar. This depreciation occurred after the rupiah managed to strengthen 0.24% to Rp17,945 per US dollar at the close of trading last week, on Friday (3/7/2026). Meanwhile, the US dollar index (DXY), which measures the greenback’s strength against six major world currencies, was observed strengthening 0.09% to 100.946 as of 09:00 WIB. The rupiah’s movement at the start of this week is expected to remain influenced by both external and domestic factors. Externally, the direction of the US dollar in global markets remains a primary concern. The US dollar moved steadily near a two-week low after market participants began to reduce expectations of an interest rate hike by the US central bank, the Federal Reserve, this year. Last week, the US dollar recorded its deepest weekly decline since April. That correction occurred after a US labour report showed job growth slowed sharply in June, thereby easing market expectations regarding the likelihood of a Fed rate hike. Nevertheless, pressure on the rupiah still needs to be monitored, particularly from the domestic side. One market concern stems from Indonesia’s trade balance, which has returned to a deficit after six years of maintaining a surplus. Statistics Indonesia (BPS) previously recorded that the nation’s trade balance suffered a deficit of US$1.61 billion in May 2026. This deficit ended a 72-month streak of export-import surpluses that had been running since May 2020. Bank Central Asia (BCA) economists assess that pressure on exports could continue going forward. Several hindering factors include the Fed’s more hawkish policy direction, the potential for slowing global demand, the mandatory B50 biodiesel programme which could affect the allocation of CPO for export, and policy uncertainty related to commodities such as coal and nickel. In addition, imports are also expected to potentially increase. Persistently high government spending is seen as capable of offsetting the impact of rupiah depreciation on import demand. ‘The combination of these factors creates a feedback loop leading to rupiah weakening, which we expect will be addressed by an additional 50 bps increase in the BI policy rate this year,’ wrote BCA economists Jennifer Calysta Farrell and Victor George in the BCA Economic and Industry Research edition of 2 July 2026.