Rupiah Weakens as US CPI Inflation Rises

US CPI inflation rose by 0.6 per cent month on month in September 2026, up from 0.4 per cent the previous month, but in line with market expectations.

Jakarta (ANTARA) – The rupiah weakened by 45 points, or 0.25 per cent, to Rp17,948 per US dollar at the opening of trading on Thursday, compared with the previous close of Rp17,903 per US dollar.

Permata Bank chief economist Josua Pardede said the rupiah’s decline was influenced by rising US Consumer Price Index (CPI) inflation.

“US CPI inflation rose by 0.6 per cent month on month in September 2026, up from 0.4 per cent month on month the previous month, but still in line with market expectations,” he told ANTARA in Jakarta on Thursday.

Year on year, headline inflation rose to 3.7 per cent from 3.4 per cent, exceeding the market consensus of 3.6 per cent. September 2026 inflation was also at its highest level since May 2026. He said the rise in headline inflation was driven mainly by higher energy costs.

“The higher-than-expected inflation data strengthened expectations of a hawkish stance from the Fed, thereby supporting the US dollar,” Josua said.

As of this morning, he added, investors still expected the next policy rate increase to take place in December 2026.