The USD to IDR exchange rate is currently range-bound, trading near seven-day highs.
Key drivers include:
- Interest Rate Differential: The Federal Reserve is expected to implement rate cuts by mid-2026, while Bank Indonesia maintains its policy stance, impacting the USD's strength against the IDR.
- Global Economic Growth: Improving global growth and rising commodity prices may lead to increased volatility affecting both currencies.
- Bank Indonesia's proactive measures, including interventions to stabilize the rupiah, aim to support its value amid external pressures.
In the near term, the exchange rate is expected to remain within a limited range, reflecting recent stability seen in the price movements.
Upside risk factors could arise from stronger-than-expected US economic data, which might boost the dollar's value. Conversely, any significant deterioration in global market sentiment could further pressure the rupiah, widening the USD/IDR range.