JAKARTA — Bank Indonesia (BI) has addressed the persistent depreciation of the Indonesian Rupiah, which is currently nearing the Rp 18,000 per US dollar threshold. According to Ramdan Denny Prakoso, Head of the Communication Department at Bank Indonesia, the ongoing weakness of the local currency is largely driven by escalating geopolitical tensions in the Middle East alongside a sustained high demand for the greenback.
Data from Bloomberg indicates that the Rupiah fell by 35 points, or 0.20 percent, settling at Rp 17,880.5 per US dollar at the close of trading on Friday, May 29, 2026. This decline follows the previous trading session, where the currency was valued at Rp 17,845.5 per US dollar.
“The pressure on the Rupiah remains influenced by continued global uncertainty stemming from the conflict in the Middle East,” Denny stated during a press briefing in Jakarta on Friday. “Additionally, there is a seasonal spike in foreign exchange requirements for external debt payments and dividend repatriations, occurring while the supply of incoming US dollars remains limited.”
To mitigate the downward trend, Bank Indonesia reaffirmed its commitment to maintaining currency stability through a strategy of being present in the market around the world, around the clock. The central bank is actively utilizing foreign exchange interventions, including Non-Deliverable Forward (NDF) transactions in offshore markets.
Domestically, BI is consistently and measurably intervening through spot transactions and Domestic Non-Deliverable Forward (DNDF) contracts, as well as purchasing government securities (SBN) in the secondary market. Furthermore, the bank is strengthening its monetary policy mix to ensure that interest rate structures remain pro-market. These measures are designed to preserve the appeal of domestic financial assets and encourage foreign capital inflows.
To manage the rising demand for foreign currency, Bank Indonesia has introduced new regulations regarding cash transactions. “We have set a new threshold for spot US dollar purchases against the Rupiah without an underlying transaction, capped at 25,000 US dollars per entity per month, which will take effect starting June 2026,” Denny explained.
Moving forward, BI continues to coordinate closely with relevant authorities to ensure financial market stability. This includes enhanced oversight of banks and corporations that exhibit high volumes of US dollar purchasing activity. Bank Indonesia maintains that it will continue to monitor both global and domestic financial developments, taking all necessary, measured actions to safeguard the Rupiah and support the external resilience of the Indonesian economy.
Summary
Bank Indonesia is actively addressing the recent depreciation of the Rupiah, which has neared the Rp 18,000 per US dollar level. The central bank attributes this decline to ongoing geopolitical tensions in the Middle East, high global demand for the dollar, and seasonal spikes in foreign exchange requirements for debt and dividend payments.
To stabilize the currency, Bank Indonesia is employing market interventions, including spot transactions, Non-Deliverable Forward (NDF) contracts, and the purchase of government securities. Additionally, the bank has introduced a new $25,000 monthly limit on underlying-free spot US dollar purchases starting in June 2026 to manage demand and preserve domestic financial resilience.