JAKARTA: The Indonesian rupiah on Tuesday (16 April) slumped to its weakest level in four years as markets reopened after the Eid al-Fitr holiday, prompting the central bank, Bank Indonesia, to intervene.
The rupiah weakened by 2.27 percent to 16,200 per US dollar, which was the weakest level since early April 2020, leading the decline among the currencies of developing countries in Asia.
Even though Indonesian markets were closed for a holiday, the US dollar strengthened after strong US economic data and rising inflation caused the market to ignore expectations of when the Federal Reserve could start lowering interest rates.
“Bank Indonesia is taking steps to maintain rupiah stability by maintaining supply-demand balance in the foreign exchange market, through three interventions,” Edi Susianto, head of the central bank’s monetary department, told Reuters.
The central bank intervened mainly through spot and domestic non-deliverable forwards, he added, while increasing the attractiveness of rupiah-denominated assets.
The benchmark stock index also weakened, falling as much as 3.02 percent on Tuesday, before declining again.
The benchmark 10-year bond yield rose to 6.83 percent, the highest since November 2023.