Rupiah Weakens and Risks Breaching Rp 17,000 Amid Middle East Escalation
Jakarta – The Indonesian rupiah exchange rate against the US dollar is predicted to remain volatile but closed weaker in trading today. According to data from Bank Indonesia’s Jakarta Interbank Spot Dollar Rate (Jisdor BI), the rupiah stood at Rp 16,779 per US dollar on Friday, 27 February 2026, weakening 21 points from the previous trading day’s rate of Rp 16,758 on Thursday, 26 February 2026.
Meanwhile, in spot market trading on Monday, 2 March 2026, up to 09:05 Western Indonesia Time, the rupiah was transacted at Rp 16,831 per US dollar, weakening 44 points or 0.26 percent from the previous level of Rp 16,787 per US dollar.
Economist and money market analyst Ibrahim Assuaibi said tensions in the Middle East escalated after the Israeli entity attacked Iran on Saturday, 28 February 2026 local time. Iran responded by firing missiles at Tel Aviv and US military bases in Bahrain, Kuwait, Qatar and the United Arab Emirates.
“Tensions in the Middle East will impact commodity prices and the rupiah exchange rate. The impact will be significant; it is likely that world gold prices will rise, precious metals will rise, and the rupiah will weaken,” Ibrahim said in his daily research on Monday, 2 March 2026.
Additionally, world gold prices are likely to increase and will impact derivative prices. Should the conflict escalate, it is not unlikely to trigger proxy nations on each side to intervene.
“Countries such as China and Russia will support Iran, whilst the Israeli entity will ally with the United States,” he said.
Ibrahim projects that gold prices could surge to a range of US$5,365 to US$5,500 per troy ounce. The current world gold price stands at US$5,280 per troy ounce.
If world gold prices increase, domestic precious metal prices will also rise, with increases estimated at a range of Rp 3,150,000 to Rp 3,400,000 per gram.
“The rupiah exchange rate is not unlikely to breach Rp 17,000 per US dollar. At the close of Friday trading, the rupiah closed lower at Rp 16,787 per US dollar,” Ibrahim said.
He added that Bank Indonesia must anticipate this development by intervening in the money market and implementing monetary surveillance.