Rupiah Strengthens as Markets Bet on Middle East De-Escalation

7 hours ago 2

TEMPO.CO, Jakarta - Indonesia’s rupiah strengthened against the U.S. dollar in Wednesday morning trade, supported by market optimism over a possible de-escalation in the conflict involving the United States, Israel, and Iran.

The rupiah rose 55 points, or 0.32 percent, to Rp16,986 per U.S. dollar, from the previous close of Rp17,041 per dollar.

Rully Nova, an analyst at Bank Woori Saudara, said the rupiah’s gains were driven by a weaker U.S. dollar index as investors responded positively to signs that tensions in the Middle East could ease.

“The rupiah is expected to strengthen in today’s trading in the range of Rp16,940 to Rp17,040, influenced by the decline in the dollar index caused by market optimism over a de-escalation in the U.S.-Israel war with Iran,” Rully told Antara in Jakarta on Wednesday.

Citing Sputnik, Rully referred to a report by The Wall Street Journal published on Monday, March 30, which said U.S. President Donald Trump had told his staff he was prepared to wind down military operations against Iran even if the Strait of Hormuz remained only partially reopened.

According to the report, Trump and his advisers had concluded in recent days that a full mission to reopen the strategic waterway could prolong the conflict beyond the operation’s initial four- to six-week timeline.

Instead, Washington would focus on limiting Iran’s naval capabilities and missile stockpiles while seeking to ease hostilities and pressure Tehran to restore trade flows, the report said.

Domestically, Rully said investors were also responding positively to the government’s planned efficiency measures.

However, he noted that markets remained cautious as global oil prices were still hovering around US$100 per barrel.

On the domestic data front, Indonesia’s March 2026 inflation is expected to ease to 3.65 percent from February, helped by electricity tariff incentives and stable food prices after the Eid al-Fitr holiday.

Rully also said Indonesia’s trade balance was expected to remain in surplus at around US$1.5 billion, an improvement from the previous month, supported by higher exports and imports.

Read: Rupiah Weakens to 17,041 per US Dollar as Oil Prices Surge

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