Dollar Rises Against IDR Amid Rising Bond Yields and Oil Prices

The US Dollar continues to rise against the Indonesian Rupiah (IDR), with USD/IDR trading at around 17,810 during European hours on Wednesday.

This appreciation is driven by rising bond yields and surging oil prices, which have reignited concerns over persistent inflation and potential Federal Reserve interest rate hikes. The US 10-year Treasury yield surged to 4.80%, its highest level since early 2025, while crude oil prices jumped significantly following escalating hostilities between the United States and Iran.

The recent economic data from the US offers a mixed backdrop for broader market sentiment. The July JOLTS job openings fell below market expectations at 7.27 million, while the ISM Manufacturing PMI eased slightly from 55.6 to 54.6 in August. Despite missing forecasts, the PMI remains firmly in expansion territory.

Analysts at ING stress that market attention remains on the long end of the US curve, where there are fears that Treasury Secretary Scott Bessent will dip into his large toolkit again to support the bond market.