Rupiah Strengthens as Bank Indonesia Prioritizes Currency Stability
The Indonesian Rupiah (IDR) has strengthened as Bank Indonesia (BI) prioritizes currency stability. The central bank, led by acting Governor Destry Damayanti, held its benchmark interest rate steady at 5.75% for the second consecutive month to maintain market calm.
This decision signals a shift in BI's policy mix, with a focus on stabilizing the rupiah to contain imported inflation while deploying targeted liquidity measures to cushion domestic economic growth.
Economists at UOB Group highlight that Acting Governor Damayanti emphasized preserving rupiah stability amid global financial market volatility as BI's key priority. She also reaffirmed the central bank's commitment to keeping inflation within its target range of 2.5% ±1% in 2026-2027.
The USD/IDR pair has extended its losses for the second successive day, trading around 17,810 during Asian hours on Thursday. The US Dollar (USD) is strengthening due to hawkish sentiment emerging from the latest Federal Reserve meeting minutes and geopolitical tensions in the Strait of Hormuz.