Rupiah passes Rp18,000 per US dollar on 16 October; on 21 October Bank Indonesia holds the BI-Rate at 5.75%, raises the deposit facility rate to 5.00% and widens its hedging incentives

Banking & FXUpdatedUpdated: October 26, 2026

On the morning of Friday 16 October 2026 the rupiah weakened past Rp18,000 per US dollar, from a close of Rp17,938 the day before. Bank Indonesia said the same day that it will stay in the market through offshore NDF trades, domestic spot and DNDF trades and secondary-market purchases of government bonds (SBN), and that outflows from domestic portfolio assets are expected to continue. One outlet reports that on Monday 19 October the rupiah closed at Rp18,046 and Bank Indonesia's JISDOR reference rate was Rp18,050. Press reports tie the pressure to a stronger US dollar and risk-off sentiment and, in two of the reports we read, to MSCI opening a consultation on reclassifying Indonesia's stock market from Emerging Market to Standalone Market. Update, 21 October: after its 20–21 October meeting the Board of Governors held the BI-Rate at 5.75% and the lending facility rate at 6.50%, raised the deposit facility rate to 5.00% from 4.75%, cut banks' rupiah reserve requirements in two steps from 1 November, and raised the premium reduction in its DNDF hedging incentive. This is a macro item: no tax or reporting obligation changes, and it is not a view on the rupiah or on the board's decisions.

Key points

Levels: Thursday 15 October close Rp17,938 and JISDOR Rp17,948 (Liputan6); Friday 16 October opened at Rp18,021 and passed Rp18,000 in the morning (Suara Surabaya, Liputan6); Monday 19 October close Rp18,046 and JISDOR Rp18,050, from a single outlet (Faktual Indonesia).
Bank Indonesia's statement, by Erwin Gunawan Hutapea, head of its Monetary and Securities Asset Management Department: BI is committed to remaining in the market to keep the rupiah stable, through offshore NDF, domestic spot and DNDF and secondary-market SBN purchases, and outflows from domestic portfolio assets are expected to continue.
Reserves and year-to-date picture: foreign-exchange reserves were US$146.3 billion at the end of September 2026, and the rupiah had weakened 0.28% since the start of the quarter as of 16 October (Liputan6).
Causes cited by the press: a stronger US dollar and global risk-off sentiment, with expectations of tighter US monetary policy after US inflation rose (Liputan6); and MSCI's consultation on reclassifying Indonesia's market, on which MSCI is reported to announce its final decision by the end of June 2027 (Suara Surabaya, Faktual Indonesia).
Decision of 21 October (board meeting of 20–21 October, announced by Governor Destry Damayanti): BI-Rate held at 5.75%, following the hold on 23 September (see our earlier entry); lending facility held at 6.50%; deposit facility raised to 5.00% from 4.75%; inflation target kept at 2.5% ±1% for 2026 and 2027. BI says the aim is to support rupiah stability and growth through rupiah liquidity, exchange-rate stability and bank intermediation (Kontan, 14:55 WIB).
Liquidity and hedging measures: the rupiah reserve requirement is cut in stages, for conventional commercial banks from 9% to 8% on 1 November and 7% on 1 December, and for Islamic banks and units from 7.5% to 6.5% and then 5.5% on the same dates. The premium reduction in the DNDF hedging incentive rises from 25% to 40% for six-month contracts and from 30% to 45% for 12-month contracts; the swap hedging incentive (15%, 20% and 25% for three, six and 12 months) and the local-currency transaction incentives continue (Kontan).

What this means for your Indonesian entity

For finance and treasury teams of an entity with US-dollar exposure, a rupiah at Rp18,000 or beyond raises the rupiah cost of dollar-denominated loans, intercompany balances, payables and imports compared with a month ago. Practical checks: (1) confirm which reference rate your accounting policy and loan agreements use for month-end revaluation, such as JISDOR, and expect a larger unrealised foreign-exchange result on dollar balances at 31 October; (2) remember that customs duty, VAT and income tax on imports are converted at the Finance Ministry's weekly 'kurs pajak' (a KMK), which is set separately from market rates, so check the one in force for the date of your declaration; (3) review dollar-priced intercompany invoices and pending payments. (4) If you hedge dollar exposure through DNDF, Bank Indonesia has raised the premium reduction in its hedging incentive, from 25% to 40% for six-month and from 30% to 45% for 12-month contracts; ask your bank which contracts qualify and from when. No tax or reporting obligation changes with this move. This is orientation, not advice, and not a view on the rupiah or on Bank Indonesia's decisions.

Sources

This page summarises publicly available information for orientation. It is not tax, legal, or accounting advice, and regulations change. Verify against the linked primary sources and contact us before acting on anything here.

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