Rupiah Faces Fresh Pressure as US Dollar Strengthens Amid Geopolitical Tensions

The Indonesian rupiah is facing fresh pressure from a stronger US dollar and geopolitical tensions. The currency strengthened by 2 points to Rp17,640 per US dollar on Monday, but remains vulnerable due to external pressures.

Rising tensions between the United States and Iran are also weighing on the rupiah, as well as strong labor market data in the US, which could give the Federal Reserve more room to focus on inflation developments. The US unemployment rate stood at 4.1%, below the Fed's estimate of 4.5% for the end of the year.

Ibrahim Assuaibi, director of Traze Andalan Futures and an analyst, expects the rupiah to fluctuate but close weaker in the range of Rp17,640 to Rp17,680 on Tuesday. He noted that the strengthening US dollar index remains a key concern for emerging-market currencies, including the rupiah.