Rupiah Plummets in Overseas Markets as Dollar Hits Rp17,800–18,000

Jakarta, CNBC Indonesia – The Indonesian rupiah against the US dollar has reached levels of around Rp18,000 per US$ in the non-deliverable forward (NDF) market. According to Refinitiv, as of Wednesday, 27 May 2026, at 10:16 WIB, the rupiah hit Rp17,800 per US$ and even reached Rp18,000 per US, markingahistoriclow.Foraone − weektenor(SW), NDFratesrangedbetweenRp17, 832andRp17, 840perUS, while the one-year tenor exceeded Rp18,228–18,245. The rupiah in the NDF market was significantly weaker than the previous regular trading session before the Eid al-Adha holiday on Tuesday, 26 May 2026, when the currency closed at Rp17,775 per US$, a 0.25% depreciation. It is worth noting that NDF is an instrument for trading currencies over a specified period at a set rate. The NDF market does not exist in Indonesia and is only available in international financial hubs such as Singapore, Hong Kong, New York, and London. The NDF market often influences sentiment in the spot market pricing. Consequently, NDF rates are frequently followed by the spot market. Notably, NDF is a foreign exchange derivative contract similar to forwards. However, unlike forwards, there is no physical delivery of the principal currency at maturity. Only the difference between the agreed initial rate and the reference rate at maturity is settled. Due to this differential settlement, NDFs are widely used for hedging, particularly when market participants seek to lock in exchange rate risks without purchasing dollars in the spot market. This is why a weaker rupiah in the NDF market compared to the spot typically signals caution. Market participants perceive heightened risks and uncertainties, leading to increased hedging demand and expectations of further depreciation.