Rupiah Weakens to 17,870 per US Dollar

Rupiah weakens to 17,870 per US dollar. On Thursday morning, 28 May 2026, the rupiah hit a level of Rp 17,870 per US dollar. PT Traze Andalan Futures Director Ibrahim Assuaibi said the rupiah’s depreciation was driven by external and internal factors.

External factors affecting the exchange rate include escalating geopolitical tensions in the Middle East. Additionally, the US Federal Reserve is expected to hold interest rates until year-end, significantly strengthening the dollar.

On the internal front, Ibrahim noted several causes for the rupiah’s weakness. ‘Internally, the rupiah’s depreciation is supported by significantly higher oil prices, high dollar demand due to substantial oil imports, dividend payments, the public shifting savings into foreign currency, and maturing debts with interest reaching Rp 600 trillion,’ he stated on 28 May 2026.

Furthermore, Ibrahim highlighted poor governance in Koperasi Merah Putih and Makan Bergizi Gratis. He stated that issues with these priority programs have caused investor concerns and triggered foreign capital outflows from the domestic market.

Ibrahim predicted the rupiah would approach Rp 18,000 per US dollar, as Bank Indonesia can only intervene in the international market on national holidays. ‘Today’s trading is likely to see the rupiah weaken by 100 points to Rp 17,900 per US dollar,’ he added.

Finance Minister Purbaya Yudhi Sadewa said the current rupiah depreciation was ‘unusual’. ‘It doesn’t make sense. Typically, depreciation occurs when there are fundamental economic disruptions,’ he said after attending Eid al-Adha prayers at the Directorate General of Taxes headquarters in Jakarta on Wednesday, 27 May 2026.

However, Purbaya expressed no concern, assuring that the government would not need to revise the 2026 state budget assumptions despite the rupiah breaching 17,800 per dollar.