Rupiah has the potential to weaken amid global turmoil and US sentiment pressure

JAKARTA - The movement of the rupiah exchange rate in Wednesday, January 14, 2026 trading is expected to be under pressure and tends to weaken against the US dollar.

To note, quoting Bloomberg, on Tuesday, January 13, 2026, the spot rupiah exchange rate closed down 0.13 percent to Rp16,877 per US dollar. Meanwhile, the Jakarta Interbank Spot Dollar Rate (Jisdor) exchange rate of the Bank Indonesia (BI) closed down 0.13 percent at a price level of Rp16,875 per US dollar.

Money market observer Ibrahim Assuaibi assessed that the global market conditions were overshadowed by negative sentiments due to unusual situations in the United States.

He highlighted the criminal investigation against the Chairman of the Federal Reserve, Jerome Powell, which triggered shocks in the financial market.

"The increasing political pressure on the Fed weakens confidence in US monetary policy," he said in his statement, quoted, Wednesday, January 14.

From a geopolitical perspective, he added that Iran is currently experiencing the largest wave of anti-government protests in recent years and the demonstrations are marked by clashes and reportedly have claimed many lives due to the actions of security forces.

US President Donald Trump also warned of possible military intervention if the Iranian government continued to use lethal force against demonstrators.

In addition, Trump announced plans to impose tariffs of 25 percent on countries that continue to maintain business relations with Iran, as an effort to tighten economic isolation against Tehran.

"A Reuters report said Trump is expected to meet with senior advisers on Tuesday to discuss options related to Iran," he explained.

Ibrahim added that global pressure also came from the Ukraine conflict, where Russia's oil export infrastructure continues to be targeted.

He said Ukrainian forces were reported to have attacked a number of Russian oil facilities and major export routes, including the Caspian Pipeline Consortium (CPC) terminal near Novorossiysk.

Meanwhile, from within the country, the decision of the Minister of Finance Purbaya Yudhi Sadewa to withdraw government funds of Rp75 trillion from the banking sector is considered not to interfere with the distribution of credit.

According to him, the withdrawal is considered safe because the liquidity of the national banking system is still at an adequate level.

"The continued liquidity of the banking sector is seen from the still high value of approved loans but has not been disbursed or undisbursed loans, namely IDR 2,509,400,000,000 or 23.18 percent of the credit ceiling available as of November 2025," he explained.

According to Ibrahim, the main problem of the banking sector today is not in the availability of funds, but in the weak demand for credit.

He added, this is seen from the limited credit growth, even though the government has placed funds of Rp. 276 trillion in banks since September 2025.

Based on Bank Indonesia (BI) data, banking credit growth until November 2025 only reached 7.74 percent on an annual basis or below BI's projection which set credit growth at 8-11 percent throughout 2025.

Ibrahim said that this condition shows that the placement of the Balance of Budget Surplus (SAL) funds in the bank is less effective in encouraging an increase in credit demand so that the effect on the economy is not significant.

"To overcome this condition, the government together with BI and the Financial Services Authority (OJK) need to find breakthroughs to increase credit demand. One of them is through increasing government spending so that economic activity moves more aggressively," he said.

In addition, Ibrahim added that fiscal stimulus in the form of tax reductions for the business world was also considered important so that business actors were more enthusiastic about expanding, not just being wait and see.

Ibrahim estimates that the rupiah will move fluctuatio but will close weaker on Wednesday, January 14, 2026 in the price range of Rp16,870-Rp16,900 per US dollar.