Jakarta. The Indonesian rupiah fell against the US dollar on Monday as markets awaited signals from the Federal Reserve (Fed), according to Ibrahim Assuaibi, a forex analyst at Laba Forexindo Berjangka.

The rupiah dropped 55.5 points, closing at Rp 15,205.5 per US dollar, down from Rp 15,150.

Ibrahim noted that the Fed cut interest rates last week, signaling a new easing cycle. Further updates are expected this week, including speeches by Fed Chairman Jerome Powell and Friday's release of the PCE inflation data.

"Additionally, the US Department of Commerce is expected to propose a ban on Chinese software and hardware in connected and autonomous vehicles on US roads this Monday,” he added. 

Tensions in the Middle East also continue to rise, with Israel launching attacks in Gaza and Lebanon, raising fears of a larger conflict in the region. Hezbollah recently vowed revenge against Israel after the country allegedly destroyed electronic devices used by the Lebanese group.
"Ongoing conflicts and the threat of war heighten concerns that a larger conflict in the oil-rich Middle East could disrupt supplies, tightening the global market," Ibrahim said.

Domestically, Energy Minister Bahlil Lahadalia said that tighter fuel subsidy rules, set for October 1, are still being discussed to ensure fairness and proper distribution to farmers and fishermen.

Ibrahim expects the rupiah to fluctuate but may strengthen to around Rp 15,200–15,280 by Tuesday.