Rupiah Strengthens to Rp 17,860 per US Dollar, BI Cites Increased Foreign Capital Inflows
The rupiah exchange rate against the US dollar has gradually improved, moving away from the Rp 18,000 level. Bank Indonesia (BI) stated that the strengthening occurred alongside the implementation of a policy mix that encouraged foreign capital inflows.
Citing Bloomberg, the rupiah closed 128.5 points or 0.71 percent stronger at Rp 17,860 per US dollar on Friday (12/6/2026). The Garuda currency had briefly touched its all-time low above Rp 18,000 per dollar at the end of last week, but has since slowly rebounded.
"The rupiah exchange rate on Friday (12/6/2026) closed at Rp 17,865/17,875 per US dollar, strengthening by 0.84 percent compared to the close on Friday (5/6/2026) at Rp 18,010/18,020 per US dollar. This development reflects the market019s positive response to Bank Indonesia019s policy mix," said BI Senior Deputy Governor Destry Damayanti in an official statement to reporters on Friday (12/6/2026).
Destry said the policies included raising the benchmark interest rate, the BI Rate, to 5.5 percent, strengthening the interest rate structure of Bank Indonesia Rupiah Securities (SRBI), providing hedging swap incentives for foreign investors, opening repo access to support banking liquidity, and increasing the intensity of rupiah and foreign exchange monetary operations.
"Following the BI Rate increase, foreign capital inflows have experienced positive developments, supported by the attractiveness of domestic financial instruments. High global investor interest is reflected in the increase in non-resident SRBI and Government Securities (SBN) transactions, which on 10 and 11 June 2026 were recorded at Rp 15.11 trillion and Rp 3.91 trillion respectively. Capital inflows also occurred in Danantara019s international bonds, whose initial sale successfully reached Rp 26.9 trillion. These developments demonstrate investor confidence in domestic assets," she explained.
Destry continued that along with these developments, Indonesia019s external resilience is believed to remain solid. This is further strengthened through financial cooperation between BI, the People019s Bank of China (PBOC), and the Hong Kong Monetary Authority (HKMA).
Three agreements were reached: synergy to strengthen not only each country019s financial resilience but also broader regional financial stability, strengthening of the Bilateral Currency Swap Agreement (BCSA), and reinforcement of the commitment to use local currencies in bilateral transactions through the expansion of Local Currency Transactions (LCT).
"These measures will reduce dependence on the US dollar and support rupiah exchange rate stability," she stressed.
Destry emphasised that BI will continue to be present in the market, optimise all policy instruments consistently and measurably, and strengthen coordination with the government and various stakeholders to maintain rupiah exchange rate stability and strengthen the external resilience of the Indonesian economy.
"With these various developments, it is believed that the rupiah will continue to strengthen against the US dollar towards its fundamental level," she said.
BI calculates that the rupiah019s fundamental value averages at Rp 16,500 per US dollar, with a lower bound of Rp 16,200 and an upper bound of Rp 16,800.