Jakarta, Indonesia – Indonesia’s currency strengthened against the U.S. dollar on Thursday 7 May 2026, as easing Middle East conflict and disappointing American jobs data persuaded investors to move back into emerging market assets.
According to data from Jakarta, the rupiah gained 62 points, or 0.36 percent, to trade at 17,325 per U.S. dollar, up from the previous close of 17,387.
The shift is part of a wider recovery in regional currencies, driven by growing optimism that the U.S.-Iran conflict may ease.
China Backs Ceasefire, Trump Reports ‘Very Good’ Talks
The primary force behind the rupiah’s advance was the de-escalation of hostilities in the Middle East, according to Josua Pardede, Chief Economist at Permata Bank.
He noted that China’s public support for a comprehensive ceasefire between the U.S. and Iran has improved market expectations for progress in negotiations.
Citing Anadolu news agency, China’s Foreign Minister Wang Yi stated that a complete halt to hostilities is essential, that reigniting the conflict is unacceptable, and that continuing negotiations is now critical.
“The Chinese government expressed its support for a comprehensive ceasefire in the Middle East, thereby raising hopes for progress in negotiations between the U.S. and Iran,” stated Josua Pardede, Chief Economist, Permata Bank.
Adding to the positive sentiment, U.S. President Donald Trump described that talks with Iran over the past 24 hours have been “very good” and that a permanent end to the U.S.-Israel war is “very likely achievable.” When asked about a deadline, Trump responded, “There is never a deadline.”
US Jobs Data Also Pressures the Dollar
Apart from geopolitical factors, disappointing U.S. economic data added to the dollar’s decline. The ADP Employment Change report for April 2026 missed market expectations.
While the figure rose to 109,000 from a previous 61,000, it still missed the forecast of 120,000.
This weaker jobs data suggests a slight cooling in the U.S. labor market, prompting traders to trim their dollar positions and benefiting currencies like the rupiah.
Source: ANTARA News
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