Inp.polri.go.id - Jakarta. Bank Indonesia (BI) attributed the Rupiah’s decline to Rp 17,529 per US Dollar on Tuesday (12/5/2026) to a combination of escalating Middle East conflicts and high seasonal domestic demand for foreign exchange. 

The geopolitical tension has spiked global oil prices and uncertainty, while domestic needs for debt payments, dividends, and Hajj pilgrimage costs have further pressured the currency.

“BI will remain committed to the market by conducting smart interventions in the spot, DNDF, and NDF markets, while optimizing all monetary instruments to reduce pressure on the Rupiah,” said Bank Indonesia Senior Deputy Governor Destry Damayanti, as cited by antaranews.com.

Despite the volatility, Bank Indonesia reported that foreign investor confidence remains strong, with Rp61.6 trillion in capital inflows to government bonds (SBN and SRBI during April 2026. The central bank expected these seasonal pressures to subside soon, allowing the Rupiah to return to its fundamental value, supported by foreign exchange reserves currently standing at 146.2 billion USD.

(mg/inp/pr/rs)