The rupiah exchange rate against the United States dollar experienced considerable pressure during the final week of February 2025, according to data released by Bank Indonesia (BI), who said that trading on Thursday concluded at IDR 16,445 per US dollar on Thursday (27/2/25,) before opening weaker at IDR 16,520 per US dollar on Friday (28/2/25,) according to reporting from Tempo.
Concurrent with these exchange rate fluctuations, the yield on 10-year Government Securities (SBN) also registered an increase, rising from 6.88 percent to 6.93 percent within the same period. In parallel, the United States Dollar Index (DXY) strengthened, reaching a level of 107.24, while the yield on the 10-year United States Treasury (UST) decreased to 4.260 percent.
The pressure exerted on the rupiah, as detailed in an official release from BI, is further evidenced by the augmentation of Credit Default Swap (CDS) premiums for Indonesia with a 5-year tenor. These premiums escalated from 70.34 basis points (bps) on February 21, 2025, to 75.13 bps on February 27, 2025, says Tempo.
Foreign capital flows indicated a notable outflow, with non-resident investors recording a net sale of IDR 10.33 trillion during the period spanning February 24 to 27, 2025. This net sale comprised IDR 7.31 trillion in the stock market, IDR 1.24 trillion in the SBN market, and IDR 1.78 trillion in Indonesian Rupiah Securities (SRBI).
Executive Director of BI’s Communication Department, Ramdan Denny Prakoso, emphasized the central bank’s ongoing commitment to maintaining the stability of the rupiah exchange rate through an integrated policy strategy, Tempo reports.
“Bank Indonesia will continue to strengthen coordination with the Government and relevant authorities, and optimize a policy mix strategy to support Indonesia’s external economic resilience,” stated Ramdan in his official remarks, as quoted on Saturday (1/3/25.)
When considering cumulative data for 2025, based on settlement figures up to February 27, 2025, non-resident investors registered a net sale of IDR 15.47 trillion in the stock market. However, they maintained a net purchase of IDR 12.86 trillion in the SBN market and IDR 7.67 trillion in the SRBI. BI reiterated its dedication to upholding monetary stability and ensuring that the rupiah exchange rate remains under control amidst a global environment characterized by persistent challenges, according to Tempo.
Source: Tempo
Stock image by Mohamad Trilaksono from Pixabay
