XA Market Update | USD/IDR Currency Cross – Is the Rupiah In Managed Decline?

 

by Ezaridho Ibnutama (Head of Research) & Graceline Melinda (associate)

14 Apr 2026

 

 

We forecast USD/IDR with an End Of Year Target at 17,250-17,350 due to external geopolitical uncertainties causing lack of confidence with Indonesia. Furthermore, the negative outlook given by multinational credit ratings agencies Moody’s and Fitch has raised concerns over the lack of clarity with impacts from the current administration’s social programs as a measure for aggressive economic growth.

 

 

🔹 PART I : Geopolitical Jitters Shake Off Foreign Funds

 

 

Cooling Down After US-Iran Ceasefire.

•  DXY Dropping Below 100. During the US-Israel-Iran conflict, U.S. Dollar Index (DXY) penetrated above 100, and hovered between 99-100. After the 2-week announcement of the ceasefire agreement, DXY formed a bearish open gap and has stayed steady at 98.7-98.9 range. As tensions ease, we view DXY will begin to weaken further to index area during the early stages of the conflict at 97.45-97.55.

 

 

America Blundering Global Leadership Role.

• Nations Forming Negotiations On Their Own. Under the frustration of nations not willing to back-up the United States in toppling the reigning Islamic Iranian regime, President Donald Trump has posted for nations to “get your own oil”. This has prompted the United Kingdom and France to create a 40-nation coalition to negotiate for the opening of the Strait of Hormuz. The coalition did not bear any progress.

 

 

 

🔹 PART II : Fragile Fiscal Management

 

 

Spending Of Program Under Fire As Energy Prices Overshoots Forecasts

• MoF Targets On Dated Assumptions. On 6th of March 2026, The Ministry of Finance Purbaya has attempted to calm the public by assuring the ministry has done a stress test on the 2026 State Budget APBN with oil price reaching USD 92 / barrel. Current Brent Crude Oil Price stands at USD 98.17 / barrel from a peak of USD 118.35 / barrel.

 

 

MoF Ready To Resign If Key Target Is Not Met

•MoF Purbaya Post Hinges On 6% GDP Growth. With the current public anxiety over rising global prices in oil, Finance Minister Purbaya announced Indonesia’s GDP in 2026  has to reach 6% or else he is ready to resign at the end of the year. As of Apr-2026, the GDP Growth consensus stands at 5% – lower than target.

 

 

 

🔹 PART III : Indonesia’s Historical Cases For Currency Depreciation.

 

 

Currency Depreciation Case #1 : 1956 Soekarno-Era Mismanagement
Currency Depreciation Case #2 : 1998 Asian Financial Crisis
Currency Depreciation Case #3 : 2013 Taper Tantrum

 

 

 

🔹 PART IV : Bank Indonesia (BI) Being Pressured On Both Ends

 

 

Yearning To Be Dovish, Needing To Be Hawkish

• BI Governor Called To Answer To DPR. On 13-Apr-2026, Governor of Bank Indonesia (BI) Perry Warjiyo has been scheduled to explain the current depreciation of the Rupiah to the People’s Representative Council (DPR). With the Indonesian Rupiah falling out of favor further above IDR 17.000, his current dovish stance is being questioned.

 

 

• BI Independence In Question With President’s Nephew Appointment. The central bank’s independence has been under recent scrutiny as the President’s nephew Thomas Djiwandono transferred his position as the vice minister of finance to being vice governor of BI. We view the introduction of BI Vice Governor Thomas Djiwandono has a dovish skew for BI rate decisions.

 

 

Rupiah Weakening As BI’s Forex Reserves Weaken

• Rupiah Depreciation Shooting Down Doves. While the President has made it clear for BI to synergize with the current administration to achieve 8% economic growth, BI’s swing from pro-stability stance under Jokowi and SBY presidency to pro-growth under Prabowo has led to three (3) rate cuts in the latter half of 2025.

 

 

• Limiting Purchase On Forex To Combat Capital Flight. BI has downgraded the maximum limit for foreign currency purchases against the Rupiah from USD 100,000 to USD 50,000 per person per month. Apart from that, BI has also raised the transaction limit for Domestic Non-Deliverable Forwards (DNDF) and swap transaction limits to USD 10 million (vs USD 5 million previously). The central bank has also tightened the Foreign Exchange Traffic (LLD) requirements by lowering the threshold for mandatory supporting documents from foreign currency transfers to USD 50,000 (vs USD 100,000 previously).

 

 

Download full report HERE.