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Rupiah hits another new low as IDX reopens Tuesday
BI held a meeting on Monday to respond to the plummeting rupiah by preparing several measures to stabilize the currency and maintain market confidence.
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Cash only: A teller arranges stacks of United States dollar and rupiah bills on March 1, 2024, at a money changer in Jakarta.
(Antara/Muhammad Adimaja)
B
ank Indonesia (BI) has vowed to “intervene aggressively” in the domestic market after the rupiah plunged to another new multi-year low on Monday, following United States President Donald Trump's sweeping tariff plans that hammered global financial markets.
The rupiah traded at Rp 17,217 per dollar momentarily before it rebounded to around Rp 16,800 against the greenback on Monday, Bloomberg data shows. At one point on March 25, the rupiah also tumbled to Rp 16,642 per dollar, its weakest since the Asian Financial Crisis in 1998.
BI held a meeting on the same day, responding to the plummeting rupiah by preparing several measures to stabilize the currency and maintain market confidence. The Indonesian Stock Exchange (IDX) is scheduled to reopen on Tuesday after an 11-day break for the Nyepi and Idul Fitri holidays.
On Monday's meeting, the central bank said it would continuously intervene in the offshore markets in Asia, Europe and New York, as well as in the domestic foreign exchange markets when they reopen on April 8, spokesperson Ramdan Denny Prakoso said in a statement on Monday.
Ramdan stated that BI would also buy government bonds in the secondary markets. “Bank Indonesia will also optimize the rupiah liquidity instruments to ensure adequate liquidity in the money market and with domestic banks,” he stated.
The country’s foreign reserves had fallen to US$154.5 billion in February from $156.1 billion in the previous month, partly because of the central bank’s intervention in the first few months of this year.
BI attributed the depreciating rupiah to the recent reciprocal tariff imposed by Trump and China’s retaliation to the policy that had caused global financial market turbulence, which increased capital outflow and weakened currency rates in emerging markets.
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