Rupiah hits new low, breaches 14,000 threshold against Singdollar

[SINGAPORE] The Indonesian rupiah fell past a historic threshold against the Singapore dollar on Wednesday (Jun 3), breaching the SGD/IDR 14,000 mark for the first time as escalating oil prices and fiscal pressures weighed on Indonesian markets.

As at 3.58 pm in Singapore, SGD/IDR stood at a high of 14,025.65. By 5.43 pm, it was still trading above the new threshold at 14,001.6, representing a 7.9 per cent increase for the pair in the year to date.

Separately, Indonesian stocks slumped to their lowest level in five years. The benchmark Jakarta Composite Index (JCI) closed 4.1 per cent lower on Wednesday, its lowest since May 2021.

The rupiah has weakened consistently through the year, as the Indonesian economy grappled with the higher oil prices caused by the US-led war against Iran.

Data released on Tuesday showed that Indonesia’s trade surplus thinned in April, as soaring prices for imported oil and gas outpaced export gains.

DBS analyst Radhika Rao said in a note on Wednesday: “April’s trade surplus shrank to US$89 million from US$3.3 billion in March, the smallest in nearly six years, following a surge in crude oil (up 67.5 per cent) and refined fuel (88 per cent) imports.”

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She added: “Without fuel price adjustments to temper demand, higher global prices and a weak rupiah are likely to weigh on the trade balance and, consequently, the current account math.”

Bank Indonesia said last Friday that it remains committed to maintaining the stability of the rupiah “around the world, round the clock”, and that it would do this by intervening in the spot currency market, non-deliverable forwards as well as purchases of government bonds.

“The rupiah depreciated 1.79 per cent in Q1 2026, nearing the lows of the Asian financial crisis. Bank Indonesia intervened heavily, burning US$8.3 billion of reserves, which weakened import cover and short-term stability,” UOB Kay Hian analyst Suryaputra Wijaksana said in a May 26 note. “Rate hikes and Bank Indonesia Rupiah Securities issuance may slow depreciation, but are unlikely to reverse the trend,” he explained.