Jakarta. Looming US government shutdown and fresh trade tariffs from President Donald Trump are casting a shadow over Indonesia’s rupiah, which managed a modest gain on Tuesday after the Asian Development Bank pared back its growth outlook for the country.

The rupiah appreciated by 15 points to Rp 16,665 per dollar at the close, recovering from an earlier dip to 16,680. Analysts warn, however, that the currency’s resilience is unlikely to hold as external risks intensify.

“Rupiah strength won’t last. With shutdown fears and trade tensions, it will likely weaken to Rp 16,660–Rp 16,710 tomorrow,” said Ibrahim Assuaibi, a Jakarta-based currency analyst at Laba Forexindo Berjangka.

In Washington, lawmakers have until midnight Tuesday local time (11:01 a.m. on Wednesday in Jakarta) to approve a spending bill and avert a federal government shutdown that could furlough thousands of workers and disrupt economic data releases. Goldman Sachs estimates a shutdown would shave as much as 0.2 percentage point off US growth per week, adding volatility to global markets.

Meanwhile, Trump has announced new import tariffs --10 percent on wood products and 25 percent on furniture starting Oct. 14-- raising concerns over supply chains and emerging-market currencies.

The rupiah’s short-lived strength came after ADB cut its 2025 growth forecast for Indonesia to 4.9 percent from 5 percent and lowered its inflation projection to 1.7 percent for this year. The softer inflation outlook may give Bank Indonesia more room to maintain its supportive policy stance, but the global backdrop remains the key risk.

The rupiah has already slipped about 4 percent this year, making it among Asia’s weaker performers as the Federal Reserve holds rates high and trade tensions resurface.