Rupiah Weakens and Inflation Looms: What Should the Public Be Wary Of?

JAKARTA, KOMPAS.com - The weakening of the rupiah exchange rate is raising concerns about inflationary pressures, particularly on the prices of daily necessities. This situation could directly affect the public, as import costs for raw materials and consumer goods rise.

The rupiah exchange rate closed lower in the spot market on Wednesday (15/4/2026) trading. The Garuda currency fell 16 points or 0.09 percent to Rp17,143 per US dollar.

Currency and Commodities Analyst, Ibrahim Assuaibi, noted that the rupiah’s weakening will almost certainly impact rising prices of imported goods. This will then spill over to consumer or public prices.

According to him, several commodities dependent on imports are already showing price pressures. Plastics are one example, where the price of raw materials has risen significantly.

“What needs to be wary of in the rupiah’s weakening? We must be vigilant. When the rupiah weakens, it definitely affects imported goods. We see that the first is plastics, whose prices are already so expensive,” said Ibrahim when contacted by Kompas.com on Wednesday afternoon.

Electronic goods are also affected because the majority of their components still come from abroad. When the rupiah exchange rate weakens, import prices become more expensive, and this burden is usually passed on to selling prices.

A similar situation is seen in ready-to-eat foods, which use many imported raw materials or are impacted by rising distribution costs.

“Then fertiliser, then agricultural commodities, including soybeans, corn for animal feed, these are also experiencing increases. Now, electronic goods, then we see that ready-to-eat foods are also experiencing quite significant increases. So this must be heeded in the rupiah’s weakening,” he explained.

These price increases reflect the chain effect of the rupiah’s weakening on production cost structures. When imported raw materials become more expensive, producers tend to pass on the cost increases to consumers in the form of higher selling prices.

However, not all parties are disadvantaged by this situation. Ibrahim believes the rupiah’s weakening actually benefits export-oriented businesses, especially in the commodities sector.

Commodities like tin, nickel, and crude palm oil (CPO) are seen to benefit because dollar-based revenues become higher when converted to rupiah. This could improve the performance of companies, both state-owned and private, operating in those sectors.

“Then we see who benefits from the rupiah’s weakening? Those who benefit are entrepreneurs doing exports-imports, especially commodities like tin, nickel, CPO, these are benefited,” he stressed.

“So domestic companies, both red plate and private, are gaining profits with the strengthening of the dollar index,” he continued.

According to him, controlling inflation must be the main focus, especially because the current inflationary pressures are cost-push in nature, triggered by rising raw material and energy costs. This situation is worsened by the El Niño threat and fertiliser price increases.

“The government must have priorities, first controlling inflation because of cost-push or rising raw material and energy costs. The super El Niño challenge accompanied by rising fertiliser and weakening rupiah exchange rate becomes a dangerous combination for food inflation,” said Bhima to Kompas.com.