Rupiah Hits All-Time Low at Rp 16,859 per Dollar Amid U.S. Tariff Shock

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JAKARTA, investortrust.id – The Indonesian rupiah has plunged to a record low against the U.S. dollar on Tuesday, April 8, 2025, despite aggressive intervention by the country's central bank. The sharp depreciation followed the announcement of a steep tariff hike by the U.S. administration and triggered a sharp sell-off on Indonesia’s stock exchange, forcing a temporary trading halt.

The intervention by Bank Indonesia failed to prevent the rupiah from tumbling as markets reopened following an extended holiday for the Nyepi and Eid al-Fitr celebrations. Market volatility was sparked by a new U.S. trade policy, enacted by President Donald Trump, which increased baseline import tariffs to 10 percent on April 5 and imposed a retaliatory tariff of 32 percent on goods from Indonesia. The announcement was made on April 2 while Indonesian markets were closed.

By mid-morning Tuesday, the rupiah had fallen 280 points, or 1.69 percent, to Rp 16,834 per dollar, according to Yahoo Finance. It slid further by noon, hitting an all-time low of Rp 16,859 per dollar—a 305-point drop or 1.84 percent on the day. Earlier in the morning, it had already touched a historic low at Rp 16,849 per dollar. Year to date, the rupiah has lost 4.81 percent of its value.

Against the euro, the rupiah also reached its weakest level ever at Rp 18,506 before recovering slightly to Rp 18,436 by 3:28 p.m. local time—a drop of 732 points or 2.06 percent.

Meanwhile, the Indonesia Composite Index (IHSG) opened sharply lower and fell 598.56 points, or 9.19 percent, to 5,912.06. The plunge prompted the Indonesia Stock Exchange to suspend trading for 30 minutes—the first application of a new rule activated earlier that morning, which mandates a halt if the index drops more than 8 percent.

Previously, on March 18, 2025, a trading halt had also been triggered when the index fell more than 5 percent, in accordance with the previous rules. That event marked the first trading suspension in Indonesia since the COVID-19 pandemic in 2020.

Trading resumed on Tuesday afternoon, with the IHSG recovering slightly to 6,000.84 by 1:59 p.m., though still down 7.72 percent on the day.

Central Bank Intervenes in Offshore and Domestic Markets

Bank Indonesia’s Board of Governors convened for an emergency meeting on Monday, April 7—despite the national holiday—to address the growing pressure on the rupiah. The central bank began intervening in offshore markets, particularly in the Non-Deliverable Forward (NDF) segment, to stabilize the exchange rate.

Ramdan Denny Prakoso, Head of the Bank's Communication Department, said that the reciprocal tariff policy announced by the U.S. government on April 2, followed by retaliatory measures from China on April 4, had sparked turmoil in global financial markets. This included capital outflows and severe currency depreciation in many emerging markets.

“The pressure on the rupiah emerged in offshore markets during the domestic long holiday. Bank Indonesia intervened continuously across New York, Asia, and Europe. Starting April 8, we will act aggressively in the domestic market—through spot market and Domestic NDF (DNDF) interventions, and by purchasing government securities in the secondary market,” Prakoso said.

In addition to forex operations, Bank Indonesia also plans to optimize rupiah liquidity instruments to ensure sufficient funds in the domestic money market and banking sector. These measures aim to stabilize the exchange rate and restore investor confidence.

Sharp Declines Against Yen and Euro

The rupiah’s decline was broad-based, extending to other major currencies including the Japanese yen and euro. By 3:20 p.m. local time, the rupiah stood at Rp 114.54 per yen—down 2.5 points or 2.23 percent from Monday, and 11.8 percent lower year to date.

This trend followed the weakening of the U.S. dollar index (DXY), which tracks the greenback against a basket of major currencies. The index was down 0.33 points, or 0.32 percent, to 102.93 earlier in the day.