Rupiah Opens Weaker as US Dollar Climbs to Rp17,960
Jakarta, CNBC Indonesia – The Garuda currency had to begin trading this week, Monday (20/7/2026), by weakening considerably against the US dollar.
According to Refinitiv data, the rupiah exchange rate opened 0.42% lower at Rp17,960/US, bringingtherupiahbacktowardsRp18, 000/US. This followed the close of last week’s trading on Friday (17/7/2026), when the rupiah strengthened sharply by 0.53% to Rp17,885/US$.
This morning’s weakening of the rupiah occurred as the US dollar index against six major world currencies (DXY) moved steadily. The DXY stood at 100.765 after rising 0.28% at Friday’s close last week.
The US dollar strengthened slightly against most world currencies at the start of Asian trading today. Escalation of the conflict in the Middle East has once again heightened investor caution, while also pushing up oil prices.
These conditions have increased demand for the US dollar as a safe-haven asset. As a result, the room for developing-market currencies, including the rupiah, to strengthen has become more limited.
On the monetary policy side, markets still expect the US central bank (the Federal Reserve/the Fed) to keep interest rates unchanged at its upcoming meeting on 29 July.
Based on the CME FedWatch Tool, the chance of the Fed holding rates steady stands at 85.6%, a sharp increase from 61.5% a month ago.
However, the Fed’s policy direction remains overshadowed by differences of opinion among its officials. Cleveland Fed President Beth Hammack on Friday joined several other officials who believe interest rates may need to be raised to curb persistently high inflationary pressure.
These remarks open the door to heated debate at the Fed’s upcoming meeting, as well as the possibility of a dissenting vote at the second meeting chaired by Kevin Warsh as Fed Chair.
Beyond external sentiment, the market is also awaiting the results of Bank Indonesia’s Board of Governors Meeting (RDG BI), which will announce its decision on the benchmark interest rate on Wednesday (22/7/2026).
BI has raised interest rates by a total of 100 basis points since May 2026. The most recent increase of 25 basis points was carried out on 18 June 2026, after BI had previously held an unscheduled meeting on 9 June to respond to pressure on the rupiah.