Rupiah Strengthens Despite Decline in May Foreign Exchange Reserves and Surging Crude Oil Prices

The exchange rate of the Rupiah against the US Dollar is predicted to remain volatile, though it closed weaker in today’s trading. According to the Bank Indonesia Jakarta Interbank Spot Dollar Rate (Jisdor) data, the Rupiah stood at Rp 18,171 against the US Dollar on Monday, 8 June 2026. This position represents a decline of 132 points from the previous rate of Rp 18,039 recorded during Friday’s trading, 5 June 2026.

In spot market trading on Tuesday, 9 June 2026, as of 09:03 WIB, the Rupiah was traded at Rp 18,141 per US Dollar, strengthening by 46 points or 0.26 per cent from its previous position of Rp 18,187 per US Dollar.

Economic and money market observer, Ibrahim Assuaibi, noted that the market is experiencing anxiety regarding the massive government expenditures under the Prabowo administration for the MBG and Kopdes Merah Putih programmes. “This is causing the current account deficit to widen, alongside a shrinking Indonesian trade surplus,” Ibrahim stated in his daily research on Tuesday, 9 June 2026.

Furthermore, the government must recalculate significant fuel subsidies necessitated by the surge in crude oil prices following the closure of the Strait of Hormuz by Iran. Consequently, the demand for US Dollars remains high, contributing to an increase in government debt.

Bank Indonesia (BI) reported that foreign exchange reserves reached US$144.9 billion, or approximately Rp 2,590.2 trillion, at the end of May 2026. This figure is a decrease from the US$146.2 billion recorded the previous month. Looking further back at historical data, the US$144.9 billion level represents a new low for the last 23 months, since June 2024, when reserves stood at US$140.2 billion.

The foreign exchange reserve position at the end of May 2026 is equivalent to 5.6 or 5.5 months of imports and government external debt payments, remaining above the international adequacy standard of approximately 3 months of imports. Therefore, BI assesses that these reserves are still capable of supporting external sector resilience and maintaining macroeconomic and financial system stability. The central bank remains confident that external sector resilience will be maintained with these reserves.

“The Rupiah remains volatile but closed weaker within the range of Rp 18,180-Rp 18,230,” he added.