JAKARTA - The rupiah exchange rate in trading Friday, July 25 is expected to move higher against the United States (US) dollar.
To note, citing Bloomberg, on Thursday, July 24, the rupiah spot exchange rate was closed slightly up 0.05 percent to the level of Rp. 16,295 per US dollar. Meanwhile, the Jakarta Interbank Spot Dollar Rate (Jisdor) exchange rate of Bank Indonesia (BI) closed up 0.09 percent to a price level of Rp. 16,283 per US dollar.
Currency observer Ibrahim Assuaibi said that the lasar was monitoring the development of the US-EU trade negotiations, following President Donald Trump's tariff agreement with Japan.
"The agreement lowers automotive import import duties and frees Tokyo from new levies in exchange for US$550 billion in investment and loan packages aimed at the US," he said in his statement, quoted Friday, July 25.
Additionally, two European diplomats said the European Union and the US were moving towards a trade deal that could cover a US base rate of 15 percent for European Union goods and possible exceptions, potentially paving the way for other major trade agreements.
On the other hand, Ibrahim said that today's market focus is data on Weekly Early Unemployment Claims and the release of the Purchase Manager Index (PMI) from the US, the Euro Zone, and the UK, with investors watching signs of resilience or weakening the global economy.
According to him, this data will provide new insights into manufacturing and service activities for July, and could affect the expectations of interest rate policies.
Meanwhile, from within the country, Ibrahim said that economists assess that jumbo spending designed by the 2026 State Budget is not necessarily able to raise economic growth as expected, which is in the range of 5.2 percent to 5.8 percent.
Meanwhile, the government's budget, which continues to grow and is predicted to reach IDR 3,820 trillion, certainly has great potential to encourage economic growth. Mainly if it is focused on strategic sectors.
In addition, the 2026 priority programs such as Free Nutrition Food (MBG), education, health, and MSMEs, do have a multiplier effect on the national economy. However, in practice, there are a number of structural challenges that still overshadow the effectiveness of government spending as an instrument to drive growth.
Ibrahim said the same as this year, with a budget of IDR 3,621.3 trillion and very ambitious, the realization was actually slow because the planning process was not mature enough.
"Even Ministries and Agencies (K/L) are often not technically ready and administratively to immediately execute the budget at the beginning of the year," he said.
According to him, this has caused the absorption of the budget to start to stretch in the third quarter of 2025, even though to encourage growth, fiscal stimulus should be carried out evenly throughout the year.
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He added that not to mention, the automatic adjustment policy aka blocking the budget which is often applied when state revenues are not on target.
Ibrahim said that when acceptance was depressed, K/L shopping could be subject to sudden refocusing or pruning.
"In a situation like this, spending that was originally designed as a growth driver could lose its effectiveness because important projects had to be postponed or even canceled," he said.
Ibrahim estimates that the rupiah will fluctuate but close higher in trading Friday, July 25, 2025 in the price range of IDR 16,240 - IDR 16,300 per US dollar.
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