Jakarta. The Indonesian rupiah has been classified as one of the world’s ten weakest currencies by Forbes, ranking fifth after the Laotian kip.

However, the label “weak” can be misleading. As Forbes noted in its Jan. 9 edition, the ranking is based solely on “the number of units you’d receive in exchange for one US dollar,” rather than on macroeconomic stability or underlying economic fundamentals.

In other words, the classification reflects nominal exchange levels, not the strength or resilience of an economy.

On that date, one US dollar bought about Rp16,849, compared with roughly 89,556 Lebanese pounds — the weakest currency on the list — and around 42,112 Iranian rials, ranked second.

In Iran’s case, international economic sanctions, domestic political instability, and regional conflicts — including Israel’s military actions — have placed sustained pressure on the rial, helping explain its continued depreciation against the dollar.

Indonesia presents a markedly different picture. The country has enjoyed political stability over the past two decades, while its economy has expanded at an average rate of about 5% annually in the post-pandemic period. Indonesia also remains Southeast Asia’s largest economy by gross domestic product.

Still, Forbes noted that “its national currency has tumbled when compared with others due to a combination of high inflation and recessionary fears.”

Indonesia’s inflation rate stood at 2.92% throughout 2025, comfortably below the government’s upper tolerance level of 3.5%.

Crucially, the “weak currencies” category in the Forbes ranking refers to nominal value, not to economic instability — though the distinction may be less relevant in cases such as Iran, where currencies are also poorly managed or highly volatile.

The Lebanese pound, for example, has been under severe pressure for years due to a depressed economy, runaway inflation, high unemployment, a banking-sector collapse, and persistent political unrest, according to Forbes.

While the rupiah has weakened against the dollar in recent weeks, its depreciation has been gradual and far less severe than the collapse seen in currencies such as the Iranian rial.

Indonesia could, in theory, make the rupiah appear “stronger” overnight by redenominating it — removing three zeros — without changing any real economic fundamentals. Such a plan has appeared on the Finance Ministry’s agenda in the past, but it has faced resistance from economists and business groups, who warn of costly transitions, including widespread accounting adjustments and potential public confusion.

The rupiah’s global reputation, meanwhile, remains heavily shaped by history. During the 1997–1998 Asian financial crisis, the currency lost more than 80% of its value, an episode that continues to loom large in investor memory.

That crisis became a defining reference point for foreign investors, cemented a long-lasting perception of fragility, and still influences the risk premiums applied to Indonesian assets today — despite decades of stronger macroeconomic management.

The 10 weakest currencies in the world, according to Forbes:

• Lebanese pound (LBP) – Lebanon – ~89,556 LBP
• Iranian rial (IRR) – Iran – ~42,112 IRR
• Vietnamese dong (VND) – Vietnam – ~26,345 VND
• Laotian kip (LAK) – Laos – ~21,663 LAK
• Indonesian rupiah (IDR) – Indonesia – ~16,849 IDR
• Uzbekistani som (UZS) – Uzbekistan – ~11,861 UZS
• Guinean franc (GNF) – Guinea – ~8,658 GNF
• Burundian franc (BIF) – Burundi – ~8,754 BIF
• Malagasy ariary (MGA) – Madagascar – ~4,637 MGA
• Paraguayan guarani (PYG) – Paraguay – ~6,619 PYG