Firm Dollar Keeps Rupiah Under Pressure
Jakarta. Rupiah weakened against the US dollar on Thursday midday, pressured by rising global geopolitical risks and persistent domestic fiscal concerns.
Data from Bloomberg showed that as of 11:29 a.m. Jakarta time, the rupiah had slipped 9.5 points, or 0.06%, to Rp 16,789 per dollar in the spot market. The dollar index edged up 0.01% to 98.69.
The local currency had already closed weaker on Wednesday, shedding 22 points to end the session at Rp 16,780 per dollar.
Rully Nova, an analyst at Bank Woori Saudara, said the rupiah remains vulnerable amid heightened global risk sentiment, particularly surrounding fresh geopolitical developments involving the United States.
“The rupiah is expected to trade weaker today in the range of Rp 16,770 to Rp 16,820, still influenced by global geopolitical risk sentiment related to the US plan to take control of Greenland, as well as the direction of The Fed’s interest rate policy,” Rully said.
The White House said President Donald Trump’s proposal to acquire Greenland is aimed at preventing what it described as potential “aggression” by China and Russia in the Arctic regios as cited by Kyodo.
White House spokesperson Karoline Leavitt, speaking at a press briefing, said the acquisition plan is “actively being discussed” by Trump and his national security team. She added that all options remain on the table, including military measures, while stressing that diplomacy remains Trump’s preferred first step.
The renewed push has drawn strong reactions from European leaders, as Greenland, an autonomous territory of Denmark, holds strategic and resource-rich significance in the Arctic.
On the domestic front, Rully said rising inflation and fiscal risks are adding to pressure on the rupiah. Inflation climbed to 2.9% in December 2025, while the 2026 state budget deficit is set at 2.68% of gross domestic product.
“The fiscal deficit risks overshooting the target, especially if tax revenue falls short,” he said, adding that these concerns continue to weigh on investor sentiment toward the rupiah.
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