Rupiah Weakens as US-Iran Negotiations Stall

Oil prices have continued to rise since the Asian session on Tuesday (28/4), driven by the impasse in peace negotiations between the US and Iran. As a result, concerns over global inflation have intensified, putting pressure on Asian currencies, including the rupiah.

Jakarta (ANTARA) - The rupiah exchange rate weakened by 32 points or 0.19 percent to Rp17,275 per US dollar on Wednesday morning from the previous close at Rp17,243 per US dollar.

Permata Bank’s Chief Economist Josua Pardede stated that the halt or impasse in peace negotiations between the US and Iran is pressuring the rupiah’s exchange rate.

“Oil prices have continued to rise since the Asian session on Tuesday (28/4), driven by the impasse in peace negotiations between the US and Iran. As a result, concerns over global inflation have intensified, putting pressure on Asian currencies, including the rupiah,” he told ANTARA in Jakarta on Wednesday.

Iran is reportedly offering a new proposal to reopen the Strait of Hormuz this week, but most parties in Washington are sceptical of the proposal because it involves delaying discussions on nuclear activities in Tehran.

Citing Anadolu, commodity prices are showing mixed trends amid tensions from the unresolved US-Iran conflict, particularly due to the closure of the Strait of Hormuz, which is triggering inflation expectations and monetary policy decisions by the US central bank.

Uncertainty over the peace negotiations, supply concerns, and persistently high energy costs are sparking forecasts of rising global inflation, which could imply a more cautious approach by the Fed moving forward.

Another sentiment stems from the United Arab Emirates’ (UAE) decision to withdraw from the Organization of the Petroleum Exporting Countries (OPEC) and OPEC+. This decision will take effect from 1 May 2026.

Based on these factors, the rupiah is expected to trade in the range of Rp17,200-Rp17,325 per US dollar.