Rupiah weakens on expectations of Fed rate hike

The rupiah exchange rate weakened by 26 points, or 0.14 percent, to Rp17,978 per US dollar on Thursday morning, compared to the previous close of Rp17,952 per US dollar. Lukman Leong, an analyst at Doo Financial Futures, stated that the rupiah’s depreciation was influenced by expectations of a Federal Reserve interest rate hike. “The rupiah is expected to remain under pressure from the US dollar amid a rise in US bond yields driven by increasing expectations of a Fed rate hike ahead of the release of US Non-Farm Payrolls data tonight,” he said in Jakarta on Thursday. The 10-year US Treasury yield rose during the day from 4.36 percent to 4.49 percent. Regarding the US NFP data, it is estimated that 110,000 jobs were added in June 2026. “Domestic sentiment has also not yet recovered from selling pressure by foreign investors,” Lukman added. Based on these factors, the rupiah is predicted to trade in the range of Rp17,900 to Rp18,050 per US dollar.