FX.co ★ Rupiah Lingers Near IDR 17,900 as Dollar Stays Strong

The Indonesian rupiah traded around IDR 17,900 per US dollar on Thursday, moving within a narrow band in recent sessions as the US dollar index hovered near an 18‑month high. The latest FOMC minutes reinforced a hawkish stance among Federal Reserve officials in response to persistent inflationary pressures, supporting the stronger dollar.

Geopolitical tensions in the Middle East also weighed on risk appetite, with potential disruptions to energy supplies fuelling concerns about higher global oil prices and Indonesia’s import bill. At the same time, investors remained focused on domestic economic conditions.

New data showed a slight decline in consumer confidence from September’s three‑month high, reflecting worries over elevated food prices and higher non‑subsidised fuel costs. Headline inflation rose to a three‑month peak in September, while August imports expanded much faster than exports, even though the overall trade surplus remained stronger than anticipated.

Foreign exchange reserves were broadly stable in September, hovering near a five‑month high. However, ongoing intervention by Bank Indonesia to support the rupiah could exert pressure on reserves, particularly in the context of uncertain portfolio inflows.