Gotrade News - Indonesia's rupiah closed at 17,243 per US dollar on Tuesday (28/04), weakening by 32 points or 0.19%. The decline reflects stalled US-Iran peace efforts and persistent structural pressures on the Indonesian economy.
--- - The Strait of Hormuz remains partially closed, disrupting global energy supplies and pressuring emerging-market currencies. - Markets are awaiting the Federal Reserve meeting this week for guidance on US monetary policy direction. - Indonesia's reliance on short-term capital flows and debt-supported reserves continues to weigh on the rupiah. ---
Currency analyst Ibrahim Assuaibi noted that diplomatic efforts to end US-Iran tensions have stalled. The Strait of Hormuz, a vital corridor for roughly 20% of global oil and gas, remains partially blocked.
Iran proposed reopening the strait but excluded discussions on its nuclear program. US President Donald Trump reportedly rejected the offer for failing to address that key requirement.
The US has maintained its blockade on Iranian ports, prolonging the energy supply disruption. The standoff has dampened global risk appetite and pressured Asian currencies, including the rupiah.
Market participants are also watching the upcoming Federal Reserve meeting for clues on the US interest rate path. The Fed's signals are expected to drive dollar strength and the relative pressure on emerging-market currencies.
On the domestic side, Assuaibi highlighted long-running structural vulnerabilities for the rupiah. A portion of Indonesia's foreign reserves is supported by external borrowing rather than current account surpluses.
Outflows of dividends and interest payments continue to offset incoming foreign direct investment. The country's manufacturing sector has also weakened, adding to pressure on the rupiah's fundamentals.
Assuaibi questioned the recurring narrative that the rupiah is undervalued whenever it weakens. Currency confidence cannot be built on framing alone without genuine improvements in the real economy.
The rupiah has depreciated significantly over the past decade, moving from around 12,000 per dollar in 2014 to current levels above 17,000. The trend underscores the need for deeper structural economic reform rather than narrative-driven defenses.
Investors are likely to remain cautious until the US-Iran impasse and the Fed meeting deliver more clarity. Domestic data points such as inflation and the trade balance will likely set the next phase of price action for the rupiah.
