Jakarta. Rupiah weakened at the start of the week on Monday as escalating geopolitical tensions in the Middle East and a sharp drop in Indonesia’s trade surplus pressured the local currency.

The rupiah closed at Rp 16,868 per US dollar, weakening 81 points from the previous close of Rp 16,793, after briefly sliding 90 points earlier in the session.

Market sentiment was dampened by both domestic and global factors. On the domestic front, Indonesia’s trade surplus shrank sharply in January, falling about 72.8% to $950 million, which analysts said reduced one of the key buffers supporting the rupiah.

External pressures also intensified as investors reacted to growing conflict in the Middle East involving the United States, Israel, and Iran, raising uncertainty across global markets.

“Markets are responding to an unprecedented escalation in the Middle East,” said Ibrahim Assuaibi, director at Traze Andalan Futures, in a written statement on Monday.

He noted that the conflict has heightened concerns not only about geopolitical stability but also about global energy supply.

“The killing of one of Iran’s most influential figures has raised fears of a broader regional conflict and the potential disruption of oil shipments through the Strait of Hormuz, a vital global energy route,” Ibrahim said.

The tensions emerged shortly after the third round of indirect nuclear talks between the US and Iran ended without progress, with Washington reportedly increasing its military presence in the region.

The developments have pushed investors toward safer assets, putting additional pressure on emerging-market currencies including the rupiah.

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