{
  "id": 253586,
  "title": "Indonesian Rupiah strengthens as foreign inflows surge into domestic assets",
  "url": "https://urgent.news/2026/08/07/indonesian-rupiah-strengthens-as-foreign-inflows-surge-into-domestic",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-08-07T06:07:23.000Z",
  "source": {
    "name": "FXStreet",
    "slug": "fxstreet",
    "url": "https://www.fxstreet.com/news/indonesian-rupiah-strengthens-as-foreign-inflows-surge-into-indonesian-assets-202608070607"
  },
  "original_language": "en",
  "account": "The Indonesian Rupiah (IDR) strengthened slightly against the US Dollar (USD) on Friday, trading at around 17,940 following a recent decline. This improvement was primarily due to an influx of foreign investments into government bonds and domestic equities in July, which helped stabilize the currency after a period of declining values. Acting Bank Indonesia Governor Destry Damayanti revealed that foreign investors had deposited 195 trillion Rupiah (around USD 10.7 billion) into government bonds and SRBI during this period. Despite this positive development, Indonesia's foreign exchange reserves experienced a minor reduction to USD 145.3 billion in July, down from USD 145.6 billion in June. This decline was mainly attributed to government foreign debt repayments and central bank interventions aimed at stabilizing the Rupiah amid heightened global financial market volatility. Nevertheless, Indonesia's reserve levels remain sufficient to cover 5.5 months of imports, or 5.3 months of imports and external debt service, which exceeds the international adequacy standard of three months. Experts at ING suggest that the resurgence in confidence towards Indonesian assets is reflected in increased overseas interest in the domestic bond market, citing that foreign participation in Indonesia's local bond market is gradually recovering following recent interest rate decisions and specific measures to stabilize the rupiah. The USD/IDR pair may experience a rebound as the US Dollar might gain support from renewed safe-haven demand due to escalating Middle East tensions. Geopolitical factors have also contributed to market instability, with the Strait of Hormuz remaining a point of concern due to rising skepticism about its reopening and Saudi Arabia's plans to extend military operations against Iran-aligned Houthis. Additionally, Iran's parliament is examining a proposal to ban US and Israeli vessels, impose a 20% cargo levy on hostile nations, and maintain the embargo until the US blockade is lifted. Fed's Nicholas Musalem delivered a slightly more hawkish stance in his speech, with an FXS Speechtracker score of 7.4/10 compared to the historical average of 7/10. This indicated that inflation expectations are at risk of losing their anchor, even though they currently align with the 2% target. Core inflation is expected to range between 2.5% and 3%, and there is a higher probability of inflation remaining above the target, alongside a greater likelihood of rate hikes. These factors contribute to upside inflation risks despite Musalem's assurance in the robust labor market and the enduring role of the US Dollar as the primary reserve currency. The FXS Fed Sentiment Index remained stable at 138.69, indicating a continued hawkish tone in Fed communications. Overall, the market uncertainty surrounding Middle East tensions and the potential impact on the US Dollar continues to influence the exchange rate dynamics between the USD and the Indonesian Rupiah.",
  "summary": "USD/IDR has pared its recent gains from the previous day, trading around 17,940 during the Asian hours on Friday.",
  "key_points": [
    "Indonesian Rupiah strengthens to 17,940 per USD",
    "Foreign inflows of 195 trillion Rupiah boost IDR",
    "Indonesia's reserves fall to 5.5 months of imports"
  ],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 2,
    "also_reported_by": [
      {
        "outlet": "FXStreet",
        "title": "Indonesian Rupiah struggles as Consumer Confidence drops to weakest level since September 2025",
        "url": "https://urgent.news/2026/08/10/indonesian-rupiah-struggles-as-consumer-confidence-drops-to-weakest",
        "published": "2026-08-10T05:03:04.000Z"
      }
    ]
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}