Rupiah Predicted To Strengthen, Supported By Trade Surplus And Market Optimism

JAKARTA - The rupiah exchange rate in trading Thursday, October 2 is expected to move higher against the United States (US) dollar.

To note, citing Bloomberg, on Wednesday, October 1, the rupiah spot exchange closed higher by 0.18 percent to the level of Rp. 16,635 per US dollar. Meanwhile, the Jakarta Interbank Spot Dollar Rate (Jisdor) exchange rate of Bank Indonesia (BI) closed up 0.07 percent to a price level of Rp. 16,680 per US dollar.

Currency observer Ibrahim Assuaibi said that the closure of the US government is expected to delay the release of labor market data that is highly anticipated this week.

According to him, the prolonged government closure is also expected to disrupt the release of US data.

"Non-farm payroll data for September is scheduled to be released on Friday, but may now be delayed due to disruptions in federal institutions," he said in a statement, quoted Thursday, October 2.

Ibrahim said the data is expected to provide a more definitive signal about the labor market that cools the market as the main motivator of lowering the Federal Reserve interest rate in September.

Meanwhile, doubts over further interest rates have also burst into the market this week, following a series of hawkish comments from Fed officials.

Meanwhile, Fed Dallas President Lorie Logan marked increased vigilance over future interest rates cuts, and stated that labor markets need to worsen further so that the central bank considers cutting interest rates more.

Meanwhile, from within the country, Ibrahim revealed that the Central Statistics Agency (BPS) noted that Indonesia's trade balance experienced a surplus of 5.49 billion US dollars in August 2025.

The surplus comes from the export value which reached 24.96 billion US dollars, while imports were recorded at 19.43 billion US dollars, marking a trade surplus for 64 consecutive months since 2020.

On the other hand, Indonesia's inflation rate in September 2025 was recorded at 0.21 percent on a monthly basis (mtm) and 2.65 percent on an annual basis (YoY) and the Consumer Price Index (IHK) increased from 185.1 in August to 187.4 in September 2025.

Previously, in August 2025 there was a monthly deflation of 0.08 percent compared to July 2025.

Meanwhile, manufacturing sector activity experienced a slowdown in September 2025, where the Indonesian manufacturing Purchasing Managers' Index (PMI) version of S&P Global dropped to 50.4 from the previous 51.5 in August, although it weakened, this figure is still above the expansion threshold.

Previously, PMI had been in a contraction phase for four consecutive months and the productivity of this sector had shown an increase in August, which was the first increase since April 2025, having previously dropped to 46.7.

In its latest report, S&P Global noted that the decline in PMI was caused by a weakening of production output, which fell for the first time in three months.

In fact, in August the manufacturing sector experienced a fairly solid expansion. However, new demand is still growing positively, providing a little impetus for industrial activity.

Ibrahim said that interestingly, amid the weakening of the main indicator, the level of optimism for business actors towards business prospects in the next 12 months has actually increased.

Meanwhile, S&P Global notes that business confidence has reached its highest level since May, as it hopes to stabilize domestic and global market expansion.

Ibrahim estimates that the rupiah will fluctuate but close higher in trading Thursday, October 2, 2025 in the price range of IDR 16,580 - IDR 16,640 per US dollar.