Rupiah Weakens as Government Efforts to Maintain APBN Deficit Amid Oil Price Volatility

The exchange rate of the rupiah against the US dollar is predicted to remain volatile but closed weaker in trading today. According to data from the Jakarta Interbank Spot Dollar Rate (Jisdor) of Bank Indonesia, the rupiah rate against the US dollar stood at Rp17,015 on Thursday, 2 April 2026. That position weakened by 13 points from the previous rate of Rp17,002 in Wednesday’s trading on 1 April 2026. Meanwhile, spot market trading on Monday, 6 April 2026, until 09:04 WIB saw the rupiah transacted at Rp16,997 per US dollar. That position weakened by 17 points or 0.10 percent from the previous level of Rp16,980 per US dollar. Economic and money market observer Ibrahim Assuaibi said the government estimates the APBN deficit to widen from the target, in line with the swelling of subsidy spending due to the rise in global oil prices triggered by the Middle East war. “Every $1 increase in oil price per barrel will add Rp6 trillion to the deficit, which was previously targeted at Rp689.1 trillion or 2.68 percent of GDP,” said Ibrahim in his daily research on Monday, 6 April 2026. Although confident it will remain below the 3 percent limit, the APBN deficit could widen to 2.9 percent of GDP. Especially if oil prices stay consistently at $100 throughout the year. However, the government still has fiscal room. One reason is that global oil prices are still fluctuating. The government targets the 2026 APBN deficit at 2.68 percent of GDP, among others with the assumption of Indonesian Crude Price (ICP) at $70 per barrel. This widening of the deficit is inseparable from the bloating of subsidy spending. Moreover, the APBN will remain a shock absorber for oil price increases, after the government did not raise fuel prices. Thus, the energy subsidy budget has the potential to swell by up to Rp100 trillion to cushion the oil price rise. Therefore, the government will continue to carry out savings to anticipate oil prices remaining at $100 per barrel throughout the year. Some methods being implemented include savings in ministry/institution spending up to three stages, to the utilisation of surplus budget balances (SAL) to patch the deficit. “The rupiah is volatile but closed weaker in the range of Rp17,000-Rp17,040,” he said.