FX.co ★ Rupiah Holds Range Amid Dollar Strength and Political Tensions

The Indonesian rupiah hovered around IDR 18,100 per U.S. dollar on Monday, holding within the narrow band seen since last week. A broadly stronger greenback pressured the currency after stronger-than-expected U.S. employment data reinforced expectations of an additional Federal Reserve rate hike. Higher global oil prices added further strain, worsening Indonesia’s fiscal outlook given its position as a net oil importer.

Domestically, Bank Indonesia continued to intervene in the foreign exchange market to curb excessive volatility, with the country’s FX reserves edging up to USD 146.8 billion in October. Market participants were also looking ahead to MSCI’s November index review later this week, while the final decision on Indonesia’s market classification is not expected until June 2027.

On the data front, attention turned to September retail sales figures due Tuesday, following a robust reading in August. Political risk remained in the backdrop after a wiretapping scandal involving senior police officials, with further demonstrations anticipated this week. Nevertheless, consumer sentiment improved, reaching a five-month high in October despite ongoing job cuts across several sectors.