Rupiah Under Pressure After Perry Warjiyo's Resignation, Investors Remain Cautious

The Indonesian rupiah has come under significant pressure, breaching the psychological level of Rp 18,000 per US dollar, after the resignation of Bank Indonesia (BI) Governor Perry Warjiyo. The announcement triggered market jitters and prompted a sell-off in domestic assets as investors reacted to the sudden leadership vacuum at the central bank.

At the close of trading on Monday (27/7/2026), the rupiah had weakened 46 points to Rp 18,009 per US dollar. The depreciation continued into Tuesday (28/7/2026), with the currency falling a further 90 points or 0.50 percent to trade at Rp 18,099 per US dollar by midday.

Rahma, an economist and professor at Airlangga University, stated that the market turmoil was primarily driven by the shock resignation. “The announcement has raised concerns among market participants regarding the continuity of monetary policy and short-term macroeconomic stability, prompting a wait-and-see attitude and selling pressure on domestic assets,” she told Republika on Tuesday (28/7/2026).

Rahma projected that the rupiah would likely continue to face headwinds, forecasting a trading range of Rp 17,930 to Rp 18,100 per US dollar. She noted that the currency’s movement would be heavily influenced by ongoing domestic political dynamics and the market’s assessment of the transition.

Despite the uncertainty, Rahma believes the central bank will act to prevent excessive volatility. She noted that Senior Deputy Governor Destry Damayanti, now serving as Acting Governor, is a seasoned figure within the institution. “BI is expected to continue optimising its market intervention instruments, including spot transactions and Domestic Non-Deliverable Forwards (DNDF), to manage the rupiah’s movement and prevent it from breaching critical psychological levels,” she explained.