Indonesia’s Finance Minister, Purbaya Yudhi Sadewa, recently addressed the fluctuating value of the rupiah exchange rate, which briefly touched Rp 17,300 per US dollar on Thursday, April 23. By Friday, April 24, at 4:00 PM Western Indonesian Time (WIB), the rupiah had settled slightly to Rp 17,229 against the US dollar.
During a media briefing held at the BPPK Purnawarman Campus in South Jakarta on Friday, April 24, Purbaya clarified that managing the rupiah’s stability and its exchange rate falls under the primary authority of Bank Indonesia (BI). Despite the recent weakening, the minister strongly asserted that this movement is not indicative of deteriorating domestic economic conditions. Instead, he underscored the robust nature of Indonesia’s economic fundamentals, which he believes remain exceptionally strong when benchmarked against other nations.
“Compared to other countries, we are still strong. Even compared to Malaysia, Thailand, and others, we are still strong. It’s just that the exchange rate movements are different, right?” Purbaya emphasized, highlighting the country’s resilience amidst global financial dynamics. He further explained that the rupiah’s trajectory is significantly influenced by prevailing global economic conditions and ever-evolving market expectations, with various domestic sentiments also playing a crucial role in shaping these perceptions.
“So, we actually need to control expectations. But that’s not my area, so I can’t intervene there,” Purbaya stated, acknowledging the psychological aspect of currency valuation while delineating the boundaries of his ministerial responsibilities.
The minister also took the opportunity to directly address swirling international speculation suggesting that Indonesia might be deliberately weakening the rupiah to boost export competitiveness—a strategy known as a beggar-thy-neighbor policy. He firmly refuted these claims.
“They say we intentionally weaken the exchange rate, causing their goods (other countries’) to lose competitiveness. I say it’s not like that. We are operating according to existing fundamentals,” Purbaya declared, dismissing the notion of a manipulative currency strategy and reaffirming Indonesia’s commitment to market-driven economics.
Looking ahead, Purbaya acknowledged the potential for negative sentiment to emerge in the short term, particularly if a widespread perception of continuous rupiah weakening takes hold. Nevertheless, he expressed confidence in the currency’s underlying strength. “But I say, even if its ‘mentality’ (rupiah’s) is strong like that, reversing it isn’t too complicated,” he concluded, offering a reassuring outlook on the rupiah’s capacity for recovery.
Summary
Indonesia’s Finance Minister, Purbaya Yudhi Sadewa, addressed the rupiah’s recent fluctuation, which briefly touched Rp 17,300 per US dollar before settling. He clarified that Bank Indonesia primarily manages rupiah stability, asserting that the weakening does not reflect deteriorating domestic conditions, as Indonesia’s economic fundamentals remain robust compared to other nations.
Purbaya explained that global economic conditions and market expectations significantly influence the rupiah’s trajectory. He firmly refuted claims that Indonesia intentionally weakens its currency for export competitiveness, stating the country operates according to existing fundamentals. The minister expressed confidence in the rupiah’s underlying strength and capacity for recovery despite potential short-term negative sentiment.