Rupiah weakens as negative sentiment from FOMC minutes release

The majority of Federal Reserve (Fed) officials warned that the central bank may need to consider raising rates if inflation remains above their 2 percent target.

Jakarta (ANTARA) - The rupiah exchange rate at the close of trading today weakened by 13 points or 0.08 percent to Rp17,667 per US dollar from Rp17,654 per US dollar previously.

Money market analyst Ibrahim Assuaibi said the weakness aligns with the release of the Federal Open Market Committee (FOMC) minutes in April 2026, which showed the majority of Fed officials warning of a potential rate hike.

Earlier, at the April meeting, the FOMC decided to keep the target range for the federal funds rate unchanged at 3.5-3.75 percent.

“The majority of Federal Reserve (Fed) officials warned that the central bank is likely to need to consider raising rates if inflation remains above their 2 percent target,” he said in a written statement in Jakarta on Thursday.

The minutes highlighted growing concerns among Fed officials about inflation pressures caused by the US war against Iran.

US President Donald Trump stated that the war against Iran is in its final stage, but also warned that the inability to reach a deal would trigger more US military actions against Iran, thereby limiting broad market optimism.

The Strait of Hormuz remains largely closed, he added, so oil prices remain relatively high despite a sharp decline earlier in the week.

Iran itself warned that if the US carries out further attacks and announced steps to strengthen its control over the key waterway, the Strait of Hormuz, which before the war carried oil and LNG shipments equivalent to around 20 percent of global consumption but most of which has since been closed.

“On Wednesday (20/5), Iran announced a new ‘Persian Gulf Strait Authority’, saying there would be a ‘controlled maritime zone’ in the Strait of Hormuz,” he said.

The Bank Indonesia Jakarta Interbank Spot Dollar Rate (JISDOR) today moved higher to Rp17,673 per US dollar from Rp17,685 per US dollar previously.