Jakarta. Rupiah remained under pressure on Monday as a stronger US dollar, geopolitical tensions and resilient US labor data overshadowed the currency's marginal gain at the close.

The rupiah strengthened by 2 points to Rp17,640 per US dollar on Monday, from Rp17,642 in the previous session. The currency had weakened by about 25 points during the session before recovering slightly toward the close.

The rupiah is expected to remain vulnerable on Tuesday as markets weigh movements in the US dollar index, geopolitical tensions and fresh US economic data, according to Ibrahim Assuaibi, director of Traze Andalan Futures and an analyst of the economy, currencies and commodities.

“For tomorrow’s trading, the rupiah is expected to fluctuate but close weaker in the range of Rp17,640 to Rp17,680,” Ibrahim said in a statement Monday.

He said the strengthening US dollar index remained a key concern for emerging-market currencies, including the rupiah.

External pressure also came from rising tensions between the United States and Iran. The US military said it attacked three Iranian oil tankers on Saturday after Iranian forces targeted US Navy vessels with ballistic missiles.

Markets are also watching the US economy, with recent data showing continued resilience in the labor market. More than 162,000 Americans joined the labor force in August, well above the estimate of 56,000. July's figure was also revised upward to 21,000 from minus 23,000.

The US unemployment rate stood at 4.1%, below the Federal Reserve officials' estimate of 4.5% for the end of the year. The relatively strong labor market could give the Fed more room to focus on inflation developments.

Investors will therefore closely watch US consumer price index (CPI) and producer price index (PPI) data due this week.

“If both data show that inflationary pressures remain high, market expectations for the Fed’s interest-rate policy could shift again. That could support the US dollar and put additional pressure on the rupiah,” Ibrahim said.

Domestically, Ibrahim said this week would test the flexibility of Indonesia’s monetary policy as authorities seek to balance economic growth with currency stability.

“The challenge is to maintain the momentum of economic growth without sacrificing rupiah stability or triggering foreign capital outflows,” he said.

Markets are also assessing the economic impact of natural disasters. The eruption of Mount Anak Krakatau since Friday has disrupted flights and daily activities over the weekend.

According to Transportation Ministry data, volcanic ash forced delays and cancellations involving more than 1,500 flights at at least eight airports, affecting around 170,000 passengers.

Domestic economic risks are also rising from peatland fires in Kalimantan and parts of Sumatra, as well as falling water levels in the Barito River. The conditions have disrupted coal transportation and could cause further supply-chain disruptions.

“Market participants will monitor disaster management efforts while continuing to assess the potential impact on economic activity, particularly if transportation disruptions and restrictions on outdoor activities persist for longer,” Ibrahim said.

Investors will also monitor several key domestic indicators this week, including Indonesia’s August foreign-exchange reserves, consumer confidence and July retail sales.

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