Rupiah weakens as S&P issues negative outlook on Indonesian bonds

Jakarta (ANTARA) - The rupiah exchange rate closed weaker on Friday’s trading by 50 points or 0.29 percent to Rp17,189 per US dollar from the previous close at Rp17,139 per US dollar.

Analyst at Bank Woori Saudara, Rully Nova, stated that the rupiah’s weakening was influenced by the negative outlook from rating agency Standard & Poor’s Global Ratings (S&P) on the bond rating.

“The rupiah in today’s trading was more influenced by domestic pressures related to the negative outlook from S&P rating agency on the government bond rating due to the government’s significant fiscal pressures,” he told ANTARA in Jakarta on Friday.

Previously, it was reported that the rating agency S&P Global Ratings was concerned about Indonesia’s debt repayment ratio.

Finance Minister Purbaya Yudhi Sadewa conveyed that S&P had inquired in detail about Indonesia’s fiscal condition, including the consistency in keeping the deficit below the 3 percent threshold against gross domestic product (GDP).

Purbaya stated there is a possibility that the 2025 State Revenue and Expenditure Budget (APBN) deficit in the Central Government Financial Report (LKPP) will decrease from the initial projection after being audited by the Financial Audit Board (BPK).

The Ministry of Finance (Kemenkeu) recorded the interim realisation of the 2025 APBN deficit at 2.92 percent of GDP. For the final audit result, Purbaya projects the deficit to narrow to 2.8 percent of GDP.

For the 2026 State Revenue and Expenditure Budget, the Finance Minister conveyed efforts to improve tax collection as well as customs and excise through organisational restructuring, among others.

“From the external side, it actually provides positive sentiment (for the rupiah), as seen from the majority of regional currencies strengthening and the dollar index remaining relatively stable,” said Rully.

The Jakarta Interbank Spot Dollar Rate (JISDOR) from Bank Indonesia today also moved weaker to Rp17,189 per US dollar from the previous Rp17,142 per US dollar.