Jakarta. The rupiah continued its downward slide against the US dollar on Friday, closing at Rp 16,304 per US dollar. The currency weakened by 48 points as investors remained cautious over the potential imposition of new tariffs by the United States.

The dollar index rose by 0.33 points to 108.1, further reflecting the strength of the greenback in the global market. The rupiah had already closed 35 points lower on Thursday, at Rp 16,256 per US dollar.

Ibrahim Assuaibi, a currency analyst at Laba Forexindo Berjangka, said the rupiah’s decline ahead of the weekend reflected a broader trend of weakness. At one point, it had dropped by as much as 70 points, touching Rp 16,304 from the previous day's close at Rp 16,256.

"Looking ahead to Monday, the rupiah is expected to remain volatile, likely trading within the range of Rp 16,300 to Rp 16,360," said Ibrahim.

Investor uncertainty stems from ongoing US tariff threats, with President Trump considering imposing 100 percent tariffs on BRICS nations (Brazil, Russia, India, China, and South Africa) in response to de-dollarization efforts. Trump has demanded that these nations commit to not pursuing such initiatives.

Indonesia joined the economic bloc earlier this year and recently signed a deal with India to trade in local currencies, reducing their dependence on the dollar.

Additionally, Trump has warned of a 25 percent tariff on exports from Canada and Mexico to the US if both countries fail to stop fentanyl shipments across the US border. This has added to concerns about a new global trade war, with Trump also expected to approve a 10 percent tariff on Chinese goods.

The US's tariff plans have heightened investor nervousness, as global markets are bracing for the potential fallout of these measures.

Ibrahim also pointed out that a study by the Atlantic Council’s GeoEconomics Center last year showed that the US dollar remains the world’s dominant reserve currency, with neither the euro nor BRICS countries able to significantly reduce global reliance on the dollar.

On the monetary front, the Federal Reserve's decision to keep interest rates unchanged signals a cautious approach in navigating persistent inflation challenges in the world’s largest economy. Attention is now focused on the upcoming release of the Personal Consumption Expenditures (PCE) index, which will offer further insight into US economic trends.

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