Rupiah strengthens as Bank Indonesia holds benchmark interest rate
Jakarta (ANTARA) - The rupiah exchange rate against the US dollar at Wednesday’s close strengthened by 22 points, or 0.12 per cent, to Rp17,840 per US dollar, compared with the previous close of Rp17,862 per US dollar.
Currency analyst and Director of Laba Forexindo Berjangka Ibrahim Assuabi said the rupiah’s strengthening accompanied Bank Indonesia’s decision to hold the benchmark interest rate, or BI Rate, at 5.75 per cent following the Board of Governors Meeting for the period 18-19 August 2026.
The central bank also maintained the Deposit Facility and Lending Facility rates at 4.75 per cent and 6.50 per cent respectively.
“This interest rate decision remains consistent with efforts to maintain rupiah exchange rate stability from the impact of heightened global turmoil due to the war in the Middle East,” he said in a written statement in Jakarta on Wednesday.
The monetary policy is also an effort to keep inflation within the government’s target range of 2.5±1 per cent and to strengthen economic growth.
In addition, BI is said to be expanding incentive policies and a number of other measures to increase foreign portfolio investment inflows, strengthen rupiah exchange rate stability, increase liquidity, reduce liquidity segmentation in the money and banking markets, and accelerate deepening of the money and foreign exchange markets.
On global sentiment, investors are said to be weighing conflicting signals from Iran and the US regarding the status of the Strait of Hormuz for shipping.
US President Donald Trump said there are no ongoing talks with Iran and stressed that the Strait of Hormuz remains open. Iran, meanwhile, said the vital waterway remains closed to shipping traffic.
“The temporary ceasefire agreement ended on Monday (17/8), and a senior Iranian official told Reuters that the country is shifting to a fully offensive military posture due to the diplomatic deadlock, although there were no reports of new attacks from either side on Tuesday (18/8),” Ibrahim said.
Bank Indonesia’s Jakarta Interbank Spot Dollar Rate (JISDOR) also strengthened today to Rp17,844 per US dollar from Rp17,856 per US dollar previously.