Rupiah weakens as Middle East geopolitical tensions escalate

The rupiah weakened in line with the majority of Asian currencies amid escalating geopolitical tensions in the Middle East, which weighed on risk sentiment across the region.

Jakarta (ANTARA) - The rupiah exchange rate on Thursday morning fell 52 points, or 0.29 per cent, to Rp18,066 per US dollar, compared with the previous close of Rp18,014 per US dollar.

Permata Bank chief economist Josua Pardede said the rupiah’s weakness was influenced by rising geopolitical tensions in the Middle East.

“The rupiah weakened along with the majority of Asian currencies as geopolitical tensions in the Middle East increased, pressuring risk sentiment in the region,” he told ANTARA in Jakarta on Thursday.

The escalation in question refers to the US military strike on Iran, which dimmed hopes of reaching a peace agreement in the region in the near future. The continuing escalation has created greater shipping problems in the Strait of Hormuz, triggering concerns about supply disruptions in the Middle East.

The strike also came shortly after the United States withdrew a key concession that had allowed Iran to sell oil internationally, a move signalling a tighter oil market in the coming weeks.

Crude oil prices also rose above US$75 per barrel, adding pressure on emerging market currencies.

Another factor came from the release of the minutes of the June 2026 Federal Open Market Committee (FOMC) meeting, which reaffirmed policymakers’ concerns about persistent inflationary pressures.

Based on these factors, the rupiah is expected to trade in a range of Rp17,975 to Rp18,125 per US dollar.