Reviewed by Gotrade Internal Analyst
Gotrade News - The Indonesian Rupiah is feeling the squeeze, sliding perilously close to the psychological level of 17,000 per US Dollar on Thursday (19/02). This pressure mounts just as the market anxiously awaits Bank Indonesia's interest rate announcement amidst a backdrop of global uncertainty.
Key Takeaways:
The Rupiah touched 16,925 against the Greenback, driven by robust US economic data.
AI investments are boosting US productivity and corporate margins, making the Dollar harder to beat.
Investors are laser-focused on Bank Indonesia's upcoming decision for domestic monetary direction.
According to Bloomberg data, the Garuda opened lower at 16,925 per Dollar this morning. This dip marks a losing streak for two consecutive days in what has been a relatively short trading week.
The Greenback is proving to be resilient, backed by solid US economic growth data of 2.7% throughout 2025. Despite job creation remaining somewhat stagnant, the US economy is showing serious muscle.
The massive wave of Artificial Intelligence (AI) investment is propping up productivity without triggering a significant wage spiral. This dynamic keeps US corporate margins high, making Dollar-denominated assets the top pick for global investors.
The allure of US assets is triggering a risk of capital outflow from the Indonesian domestic market. This sentiment was reflected in the recent Government Securities (SUN) auction, where total bids dropped by 17.66% compared to the previous period.
Market analysts also point to geopolitical tensions between the US and Iran as a factor dampening appetite for riskier assets. Investors remain wary of potential energy supply disruptions in the Strait of Hormuz, even as diplomatic talks continue.
The Fed's meeting minutes, which carried a hawkish tone, have further cemented the Dollar's dominance against emerging market currencies. The market is now waiting for the US PCE inflation data release to get a better read on the next interest rate move.
Domestically, all eyes are on Bank Indonesia's Board of Governors meeting scheduled for this afternoon. The market is pricing in a potential dovish stance from the central bank, despite the heavy external pressure on the currency.
A report from LPEM FEB UI predicts that Indonesia's domestic economic growth will likely stagnate around 5.3% this year. Fiscal challenges from the government's priority programs are seen as a lingering burden on the Rupiah's fundamental recovery.
While the Rupiah faces headwinds, US assets—specifically the S&P 500 ETF (SPY) and broader indices—are performing solidly thanks to the AI narrative and a resilient economy. You can hedge against currency volatility by diversifying your portfolio into the US market today.
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Reference:
Katadata, Rupiah Melemah Dekati 17.000 Per Dolar AS Jelang Pengumuman Suku Bunga BI. Accessed on February 19, 2026
Bloomberg Technoz, Rupiah Melemah ke Atas Rp16.900/US$ Kala Pembukaan Pasar. Accessed on February 19, 2026
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