Jakarta. Rupiah weakened against the US dollar as global and domestic factors weighed on investor sentiment ahead of key central bank decisions this week.

The local currency was depreciated 19 points to Rp 16,621 per dollar by Monday afternoon, after earlier dropping as much as 35 points from Friday’s close of Rp 16,602.

Traze Andalan Futures Director Ibrahim Assuaibi said the rupiah came under pressure from a mix of external sentiment, including remarks from US Treasury Secretary Scott Bessent, who revealed that American and Chinese officials had crafted a “substantial framework” for a potential trade deal. The development could pave the way for talks between US President Donald Trump and Chinese President Xi Jinping this week.

Trump separately told reporters that the US could reach an agreement with China regarding trade tariffs, fueling optimism in global markets but adding short-term uncertainty for emerging market currencies like the rupiah.

The rupiah also faced pressure from speculation over an imminent interest rate cut by the US Federal Reserve, following a weaker-than-expected US Consumer Price Index (CPI) report last week.

“The lower CPI reinforced bets for a 25-basis-point rate cut, and investors are now waiting for guidance on further easing prospects through the end of the year,” Ibrahim said in a written statement on Monday.

“This week’s focus will be on multiple central bank meetings, particularly the Fed’s latest policy decision, due early Thursday morning Jakarta time,” he added.

From the domestic side, sentiment was also hit by expectations of slower Indonesia’s economic growth in the third quarter of 2025, projected at 4.9 percent year on year, down from 5.12 percent in the previous quarter. The slowdown is largely attributed to weaker household consumption, reflected in the declining Consumer Confidence Index for September.

Ibrahim noted that the mass protests in late August had dampened consumer sentiment and overall spending. However, he remained optimistic about stronger growth in the final quarter of the year.

“In Q4 2025, we expect growth to pick up, supported by seasonal factors such as stronger government spending and the disbursement of excess budget balances (SAL) as part of the economic stimulus package,” Ibrahim said.