FX.co ★ Rupiah Nears Record Low as Markets Await Key Data

The Indonesian rupiah weakened toward IDR 17,800 per U.S. dollar on Tuesday, declining for a fourth consecutive session and nearing its record low of IDR 17,830. The currency came under pressure from broad dollar strength, as the dollar index climbed on rising inflation concerns linked to heightened uncertainty in the Middle East.

Domestically, sentiment was further weighed down by growing worries over Indonesia’s external position after the first-quarter current account deficit widened to its largest level in more than six years. Markets also turned cautious ahead of key releases due next week, including May inflation and April trade figures.

Although April inflation remained relatively subdued, the risk of renewed price pressures has increased amid escalating geopolitical tensions. Meanwhile, March’s trade surplus was driven primarily by weaker imports rather than robust exports, highlighting the underlying fragility of the trade balance.

Traders also evaluated newly introduced regulations requiring export proceeds to be retained within the domestic financial system, a move expected to provide some support to the rupiah. Year-to-date, the currency has depreciated around 6.4%, placing it among Asia’s worst performers, alongside the Indian rupee and the Philippine peso.