Rupiah Under Pressure as US Dollar Breaches Rp18,070

The rupiah closed sharply weaker against the US dollar in trading on Thursday (9/7/2026). According to Refinitiv data, the Garuda currency depreciated 0.44% to settle at Rp18,070/US, markingitsweakestlevelinaboutamonth.ThisisthefirsttimetherupiahhasclosedabovethepsychologicallevelofRp18, 000/US since 9 June 2026. Throughout the day, the rupiah remained in the red, opening down 0.33% at Rp18,050/US$ and briefly touching Rp18,095/US$ before paring some losses. Meanwhile, the US dollar index (DXY), which measures the greenback against six major currencies, was down 0.10% to 100.892 as of 15.00 WIB. Market dynamics remain focused on the US dollar, which has stayed relatively strong, supported by heightened tensions in the Gulf region that have boosted demand for safe-haven assets. Higher energy prices could potentially reignite global inflation and influence expectations regarding the direction of the US Federal Reserve’s interest rate policy. The market views the surge in oil prices as a factor that could accelerate the timing of a Fed rate hike, thereby supporting the dollar as investors reassess the risks of higher US interest rates. The ongoing volatility of the rupiah against the US dollar is not necessarily a boon for foreign investment in the industrial sector. Instead of buying land because it is cheaper in foreign currency terms, overseas investors are tending to adopt a wait-and-see approach. Leeds Property CEO Hendra Hartono revealed that currency instability disrupts investors’ long-term calculations, particularly concerning return on investment (ROI). ‘When the rupiah is fluctuating like this, foreign investors will not enter immediately. Even though they see the rupiah as cheap, they are calculating how low it can go. If they buy now and the rupiah continues to weaken, they will lose more. Especially if the property is leased out, the ROI does not add up when converted to dollars,’ Hartono told CNBC Indonesia on Thursday. According to Hartono, the industrial sector is typically the final stage that foreign investors touch when entering a country. Investors usually go through an adaptation process before injecting significant capital into factories or land.