FX.co ★ Rupiah Weakens to One-Month Low on Domestic Unrest

The Indonesian rupiah lingered near 16,480 against the USD, marking its weakest point in a month due to the pressure from political turmoil sparked by widespread protests across the nation. Over the weekend, President Prabowo Subianto took decisive steps by retracting a proposed IDR 50 million monthly housing stipend for lawmakers, halting all parliamentary travel, and canceling his scheduled trip to China to concentrate on regaining stability. He directed security forces to take decisive measures following incidents where residences of political figures and state infrastructure were vandalized or set on fire. Market sentiment was already on shaky ground due to global challenges, such as the risk of U.S. tariffs and ongoing capital withdrawal from emerging markets. The rupiah has depreciated by 2.4% since the beginning of the year, ranking it as Asia’s second-worst performing currency following the yen. On Monday, Indonesia’s chief economic minister reiterated that the nation’s economic fundamentals are robust, while Bank Indonesia committed to defending the currency through actions including foreign exchange intervention. Concurrently, the U.S. dollar remained strong ahead of significant labor market reports.