Rupiah Tops Rp 18,000 as Strong Dollar Presses Emerging Markets

The Indonesian rupiah breached the psychologically significant level of Rp 18,000 per US dollar on Tuesday as a stronger greenback and elevated US yields continued to pressure emerging-market currencies.

Bloomberg data showed the rupiah weakening by 24 points, or 0.13%, to Rp 18,002 per dollar in the spot market as of 9:40 a.m. Jakarta time.

Bank Indonesia Governor Destry Damayanti attributed the pressure on the rupiah to global conditions, shifts in capital flows, and weaknesses in Indonesia's external-sector fundamentals.

The stronger US dollar and elevated yields on US assets make investments in developed markets more attractive, potentially diverting capital away from emerging economies like Indonesia.