Indonesia’s economy grew 5.29% year-on-year in Q2 2026, surpassing expectations and bolstering the Rupiah against the USD.
USD/IDR fell to around 17,970 in Asian trading on Wednesday, pressured by stronger-than-expected Indonesian GDP growth and softer USD demand. The Rupiah strengthened after data showed the economy expanded 5.29% year-on-year in Q2 2026, exceeding the 5.1% consensus forecast but easing from Q1’s 5.61% gain.
Quarterly growth rebounded sharply to 3.73%, up from a 0.77% contraction in Q1 and above the 3.5% estimate. This marked the fastest quarterly expansion since Q2 2025. Meanwhile, the USD weakened as safe-haven demand faded amid diplomatic progress on reopening the Strait of Hormuz, a key energy transit route.
The proposed 60-day interim agreement between Oman and Iran, aimed at easing tensions, reduced demand for the USD as a haven asset. US officials expect an announcement as early as Wednesday.