The Indonesian rupiah weakened toward IDR 16,760 per dollar on Wednesday after briefly firming around 16,700 in the prior session, as thin holiday trading dampened activity.
Bank Indonesia’s dovish stance weighed on sentiment, even after the central bank held its key rate at 4.75% for a third meeting in mid-December, after 150bps of cuts between September 2024 and September 2025.
Governor Perry Warjiyo reiterated policymakers still have room to ease, citing mild inflation and the need to support growth, particularly after the late-November disaster in Sumatra.
Year-to-date, the rupiah has been among Asia’s weakest currencies, down about 4.2%.
Still, losses were capped by reports that Indonesia and the U.S. will sign a reciprocal tariff deal by late January, to be endorsed by Presidents Prabowo Subianto and Donald Trump.
Globally, the dollar index slipped to a near 12-week low around…
