US Dollar Strengthens to Rp17,830
Jakarta, CNBC Indonesia - The rupiah exchange rate opened weaker against the US dollar in the final trading session of the week, Friday (19/6/2026), amid strengthening global market demand for the greenback.
According to Refinitiv data, the Garuda currency opened weaker at Rp17,830/US, depreciatingby0.73. That strengthening came after Bank Indonesia (BI) again raised its benchmark interest rate, the BI Rate, by 25 basis points to 5.75%.
Meanwhile, the US dollar index (DXY), which measures the greenback’s strength against six major world currencies, was seen moving stably at 100.821 as of 09.00 Western Indonesian Time. This position remains elevated after the previous close on Thursday (18/6/2026), when the DXY surged 0.76%. The strengthening dollar index indicates market participants are still chasing dollar-denominated assets, a condition that can ultimately pressure emerging market currencies, including the rupiah.
The US dollar moved strongly as market participants continued to digest the results of the US Federal Reserve (The Fed) meeting on Wednesday local time. The meeting was the first under the leadership of new Fed Chair Kevin Warsh. Warsh’s relatively brief comments, coupled with the Fed’s latest projections on the direction of interest rates, reinforced expectations that US interest rates could still rise this year. These expectations helped push the dollar to its highest level in more than a year.
On the domestic front, market participants are also still responding to the results of Bank Indonesia’s Board of Governors Meeting (RDG BI) on Thursday (18/6/2026). In that meeting, BI again raised the BI Rate by 25 basis points to 5.75%. This decision provides hope for stability and even potential rupiah strengthening going forward, as the rate hike demonstrates BI’s continued focus on maintaining exchange rate stability amid US dollar pressures and global uncertainty.
As a note, BI has raised its benchmark interest rate by a total of 100 basis points within approximately one month. The first increase of 50 basis points was made at the May 2026 monthly RDG, followed by a 25 basis point hike at the weekly RDG the previous week, and the latest 25 basis point increase at the June 2026 monthly RDG.
In addition to raising interest rates, BI has also further tightened regulations on foreign exchange purchases against the rupiah. BI reduced the limit for outright cash purchases of foreign exchange against the rupiah without an underlying transaction to US$10,000 per entity per month. This policy will take effect on 1 July 2026.
“We are doing this to enforce existing governance rules. Dollar purchases, especially above US$10,000, must have an underlying,” said BI Deputy Governor Destry Damayanti in a press conference on Thursday (18/6/2026). Previously, BI had lowered the threshold for dollar purchases without an underlying to US$25,000 per person per month. Now, that limit has been further reduced as part of efforts to strengthen the Money Market and Foreign Exchange Market (PUVA) deepening policy to make it more advanced, efficient, and prudent. This measure is also aimed at maintaining the attractiveness of foreign investment and increasing the effectiveness of monetary policy, including in stabilising the rupiah exchange rate.