FX.co ★ Rupiah Heads for Third Weekly Loss as Monthly Decline Deepens

The Indonesian rupiah traded around IDR 18,170 per U.S. dollar on Friday, remaining under pressure even as the U.S. dollar index softened further after the Federal Reserve kept interest rates unchanged earlier this week. Domestically, Bank Indonesia Governor Destry Damayanti reiterated that the central bank’s priority is maintaining rupiah stability, noting that the current benchmark rate is still adequate to anchor inflation expectations. She emphasized that any further rate hikes would be data-dependent, following a cumulative 100-basis-point increase in May and June. Market participants stayed cautious ahead of next week’s releases of September trade data and October inflation figures. September inflation accelerated to a three-month high, driven in part by El Niño-related food price pressures. Rising import and energy costs have also stoked fiscal concerns amid ongoing Middle East tensions, keeping 10-year government bond yields close to a 6½-year peak. The rupiah is on track for a third consecutive weekly decline of about 1.1% and a second straight monthly drop of roughly 1.6%.