Bank Indonesia’s decision to keep rates unchanged at 5.75% supports the Rupiah, offsetting USD pressure amid Fed policy uncertainty.
USD/IDR trades steady around 17,960 in Asian hours after Bank Indonesia (BI) held benchmark rates at 5.75%, defying expectations for a hike. The central bank introduced targeted measures to boost foreign inflows and stabilize the currency instead of tightening policy.
Prior to the decision, markets had priced in potential rate increases due to inflation concerns and currency volatility. The Fed’s upcoming meeting, where rates are widely expected to remain unchanged, adds to USD weakness, though geopolitical risks may limit downside.
Middle East tensions, including attacks on Saudi oil tankers, have heightened safe-haven demand, partially supporting the USD despite broader economic concerns.