FX.co ★ Rupiah Slides to 4-Week Low on Lawmaker Perks Backlash

The Indonesian rupiah has depreciated to approximately 16,430 per USD, its lowest point since early August, amidst escalating public dissatisfaction over newly allocated privileges for lawmakers. Central to the issue is a controversial housing allowance of IDR 50 million per month for each member of parliament, an amount nearly ten times the minimum wage in Jakarta. This public outcry is growing as regional governments implement increased property taxes, spurred by President Prabowo Subianto’s proposed 2026 budget, which reallocates fiscal duties away from central funds to local authorities. Local news sources indicate that in response to protesters, law enforcement resorted to tear gas and water cannons, reflecting rising public unrest. This turmoil arises as families are already grappling with elevated food prices and lackluster job market growth. In response, Bank Indonesia has committed to staying active in foreign exchange markets, intervening in spot, forward, and bond markets to stabilize the rupiah. Concurrently, the US dollar has remained stable as traders anticipate PCE inflation data for insights into Federal Reserve policy direction.