Jakarta. Rupiah weakened further to Rp 18,139 per US dollar at the opening of trading on Tuesday, extending pressure on the currency as economists warned that prolonged depreciation could raise business costs, erode household purchasing power and delay investment.

Rupiah opened 4 points, or 0.02%, weaker at Rp 18,139 per dollar, according to Bloomberg data as of 9:06 a.m. Jakarta time on the spot foreign exchange market. The currency had closed at Rp 18,116 per dollar on Monday, according to Bank Indonesia’s Jakarta Interbank Spot Dollar Rate (Jisdor).

Syafruddin Karimi, a professor at Andalas University’s Faculty of Economics and Business, said the rupiah’s depreciation was more than just a change in the exchange rate, as it affected import costs, inflation, debt payments, investment and market confidence.

A weaker rupiah makes imported raw materials, machinery and energy more expensive in local currency, putting pressure on companies that rely on overseas supplies.

“Import costs for raw materials and capital goods, as well as foreign-currency debt repayments, rise in rupiah terms. Companies that struggle to pass these costs on to consumers may cut production and hiring,” Syafruddin said on Monday.

The pressure could spread further if the depreciation persists and begins to influence price expectations, financing costs and investment decisions. Low-income households would be particularly vulnerable to rising prices for essential goods, although the extent of inflationary pressure would depend on import contracts, inventories, subsidies, competition and policy responses, he said.

Separately, Bank Indonesia Governor Destry Damayanti said the central bank would remain active in financial markets to manage exchange-rate volatility.

“We remain in the market. The rupiah’s weakness also depends on supply and demand today. We will continue to monitor its movements,” Destry told reporters on the sidelines of the Danantara Technology Innovation Investment Forum 2026 in Jakarta on Monday.

Destry described the rupiah’s movements as normal market volatility, adding that BI was examining the underlying causes and taking steps to mitigate further weakness.

“This is normal volatility. We are also looking at the root causes, but we will continue to be present in the market,” she said.

Syafruddin urged the government and BI to monitor economic indicators simultaneously, maintain consistent policy communication and avoid measures that distort market price formation. He said investor confidence would be better restored through predictable regulations and credible law enforcement than through short-term intervention alone.

The government should also prioritize stable food and energy supplies, targeted social assistance and fiscal discipline to prevent financing needs from adding to risk premiums, he said. Meanwhile, BI should combine monetary instruments, measured market-stabilization operations and stronger hedging mechanisms rather than rigidly defending a specific exchange-rate level.

Financial Services Authority (OJK) and the Indonesia Stock Exchange (IDX) should also accelerate ownership transparency and market-rule enforcement, Syafruddin added.

“Policy success should not be measured by a single exchange-rate level, but by controlled inflation, continued access to financing and restored investor confidence,” he said.

Erwin Aksa, deputy chairman of the Indonesian Chamber of Commerce and Industry (Kadin), said the rupiah’s weakness was a serious concern for businesses, particularly industries heavily reliant on imported raw materials, machinery, components, energy and foreign-currency financing.

If the exchange rate moves from Rp 16,000 to Rp 18,100 per dollar, the rupiah cost of imported goods rises by around 13.1%, assuming dollar prices remain unchanged, Erwin said.

“For companies operating on relatively thin profit margins, such a cost increase is significant. This is especially true for the textile, chemical, pharmaceutical, electronics, food and beverage industries, as well as manufacturers that use imported components,” he said.

Companies may initially absorb some of the pressure through efficiency measures, existing inventories, long-term purchasing contracts or hedging. However, their ability to absorb higher costs would diminish if the rupiah continued to weaken, potentially squeezing margins, increasing working-capital requirements and forcing businesses to raise prices.

“This could weaken household purchasing power and slow domestic consumption growth,” Erwin said.

He added that exchange-rate fluctuations were a normal business risk, but the main concern was the speed of depreciation, the scale of volatility and uncertainty over the currency’s future direction.

“As the rupiah moves toward Rp 18,100 per dollar, companies need to adjust their exchange-rate assumptions when preparing budgets, calculating production costs and assessing investment feasibility,” he said.

Persistent volatility could also make projected investment returns harder to calculate, prompting companies to delay expansion plans, particularly projects requiring imported machinery and technology.

“Exchange-rate stability and predictability are far more important to businesses than maintaining the currency at a particular level,” Erwin said.

Rahma Gafmi, a professor at Airlangga University, said the rupiah’s slide toward Rp 18,100 per dollar underscored the need for closer coordination between fiscal and monetary authorities to contain volatility, maintain domestic price stability and preserve market confidence amid global uncertainty.

She attributed the pressure to a combination of global and domestic factors, including movements in US Treasury yields and the US dollar index (DXY), which can encourage capital outflows from domestic financial markets into safe-haven assets.

Domestically, investor confidence has also been influenced by macroeconomic expectations, corporate demand for foreign currency and market sentiment surrounding capital-market reforms, including discussions about MSCI’s assessment of Indonesia’s market.

The depreciation poses an immediate challenge for manufacturers that depend on imported inputs, including chemicals, electronic components, pharmaceutical ingredients, food products and animal feed, Rahma said.

“Manufacturing industries that still depend on imported raw materials will immediately feel the impact of rising production costs through imported inflation,” she said.

Companies must choose between absorbing higher costs at the expense of profit margins and raising selling prices, which could further strain purchasing power, particularly among lower- and middle-income households.

Rahma said markets would closely watch BI’s response, including interventions in the spot foreign-exchange market, the Domestic Non-Deliverable Forward (DNDF) instrument and the use of Bank Indonesia Rupiah Securities (SRBI) to maintain the attractiveness of rupiah-denominated assets.

Adjustments to the BI-Rate could also be considered to contain inflation expectations and stabilize the currency, although the central bank would need to weigh the risks to the recovery of the real economy.

“Authorities must carefully assess these options to avoid placing an additional burden on the real sector,” Rahma said.

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