Jakarta. Rupiah is expected to remain under pressure on Tuesday, with analysts projecting further weakness in the currency as geopolitical tensions and sticky US inflation dampen risk appetite.

Rupiah closed marginally weaker by 1 point at Rp 17,105 per dollar on Monday, after briefly sliding as much as 40 points from its previous close of Rp 17,104.

“On Tuesday, the rupiah is likely to move in a volatile range but end weaker around Rp 17,100 to Rp 17,150,” said Ibrahim Assuaibi, Director of Traze Andalan Futures, in Jakarta on Monday.

Ibrahim noted the rupiah has come under renewed pressure following the breakdown of US-Iran peace talks over the weekend, which has intensified geopolitical risks in global markets.

“Additionally, the consumer price index data released on Friday showed a sharp increase in inflation driven by rising energy prices due to the Iran conflict. This has further strengthened expectations that the Fed will not cut interest rates in the coming months,” he said.

Separately, Bank Permata Chief Economist Josua Pardede projected the rupiah would continue weakening this week, hovering in the range of Rp 17,000 to Rp 17,175.

“With the shift in sentiment after the failed US-Iran negotiations, the most realistic range for the rupiah is Rp 17,100 to Rp 17,175, with a potential brief test toward Rp 17,200 if follow-up news worsens, oil prices surge again, or political rhetoric escalates,” Josua said.

However, he added that the rupiah could stabilize around Rp 17,000 to Rp 17,100 if markets begin to see room for renewed dialogue between the US and Iran, and if the blockade situation does not escalate into a full disruption.

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