Dollar Surge Weighs on Rupiah, BI Maintains Stabilization Policy

RRI.CO.ID, Jakarta – The rupiah exchange rate continues to face pressure due to the strengthening of the US dollar in global markets. Amid these conditions, Bank Indonesia (BI) has reaffirmed its commitment to maintaining rupiah stability, keeping it under control, and working toward strengthening it.

BI’s Executive Director of the Communications Department, Ramdan Denny Prakoso, said that pressure on various countries’ currencies was triggered by the hawkish stance of several US Federal Reserve (the Fed) officials, as well as the strengthening of the US Dollar Index (DXY).

“BI certainly won’t leave things to chance. As always, BI will go all out to keep the rupiah stable, with a tendency to strengthen,” Denny said in a statement in Jakarta on Tuesday, July 7, 2026, as quoted by Antara.

According to Denny, market participants’ attention is focused on the outcome of the Federal Open Market Committee (FOMC) meeting on June 17, 2026. Although the Fed Funds Rate remained in the 3.5–3.75 percent range, hawkish signals from Fed officials have raised expectations that interest rates may no longer decline and could even rise this year.

“So, it is this combination of hawkish signals from Fed officials, coupled with the DXY’s rise to its highest level in the past year, that has caused the currencies of several countries to weaken against the US dollar,” said Denny.

Denny explained that the DXY had risen from 95 in January to 101 by the end of June, marking its highest level in the past year. These conditions have also put pressure on the currencies of developing countries, including the rupiah.

Nevertheless, Denny believes the rupiah’s performance remains better than that of other emerging-market currencies.

"We certainly expect that in the future, the rupiah--in addition to remaining stable--will begin to strengthen against the US dollar gradually. Therefore, coordination between various parties is essential to strengthen our rupiah against the US dollar collectively,” said Denny.

To maintain exchange rate stability, BI continues to intervene in the market 24 hours a day through spot market transactions, non-deliverable forwards (NDFs), domestic non-deliverable forwards (DNDFs), and by strengthening communication with market participants. ***