The Indonesian rupiah strengthens as softer US inflation data weighs on the dollar before President Prabowo’s 2027 budget address.
USD/IDR fell to 17,880 in Asian trading Friday, snapping a three-day losing streak for the rupiah. The move follows weaker-than-expected US inflation data, which cooled expectations for further Federal Reserve rate hikes and pressured the dollar.
Traders remain cautious ahead of President Prabowo Subianto’s 2027 budget proposal, which is expected to emphasize domestic consumption despite investor concerns over commodity export restrictions. Attention also shifts to Bank Indonesia’s upcoming policy meeting, its first since Governor Perry Warjiyo’s departure and a 100-basis-point rate hike in May-June.
US wholesale prices were flat in July, below the 0.2% growth forecast, while core PPI rose 0.2%, slightly under consensus. Annual headline PPI climbed 4.7%, with core PPI up 4.2%. Markets now await US July retail sales data later Friday.