JAKARTA - Bank Indonesia (BI) Governor Perry Warjiyo revealed that the weakening of the rupiah exchange rate against the United States dollar (USD) which approached Rp17,000 per USD was triggered by a combination of global and domestic factors.
He explained that one of the internal factors that had an impact was market sentiment, namely the ongoing process of the nomination of the Deputy Governor of BI, which deepened the pressure on the rupiah.
The three names proposed are Deputy Minister of Finance Thomas Djiwandono, who is the nephew of President Prabowo Subianto, Head of the BI Payment System Policy Department Dicky Kartikoyono, Assistant Governor Head of the BI Macroprudential Policy Department, Solikin M. Juhro
"(Domestic factors) because of market perceptions of fiscal conditions and the Deputy Governor (BI) nomination process," Perry said in a press conference, Wednesday, January 21.
He emphasized that all stages of the BI Deputy Governor nomination had been carried out in accordance with the provisions of the law and did not interfere with the implementation of the Bank Indonesia's duties and authorities.
Perry ensured that BI would continue to carry out policies professionally with strong governance, and continue to synergize with the government in maintaining stability and encouraging sustainable economic growth.
In addition to these factors, he said the pressure on the rupiah was also triggered by the outflow of foreign capital flows as uncertainty in the global financial market increased, where as of January 19, 2026, the value of capital outflow was recorded at US$1.6 billion.
"Foreign capital flows out also because there is also a large foreign exchange requirement from a number of corporations, including Pertamina, PLN, and also between and also market perceptions," he said.
From the external side, Perry said that currency weakness was not only experienced by Indonesia but also by other countries.
He added that geopolitical tensions, the United States' tariff policy, and the still high yield on US government bonds have encouraged the strengthening of the dollar and triggered a shift in capital flows from emerging markets to developed countries, including the US.
Responding to this condition, Perry emphasized that BI is committed to maintaining the stability of the rupiah exchange rate through various intervention measures, both in the domestic spot market and through Domestic Non-Deliverable Forward (DNDF) and Non-Deliverable Forward (NDF) instruments in foreign markets.
"We emphasize, Bank Indonesia is not hesitant. We are intervening in large quantities," he said.
He is optimistic that the rupiah will stabilize again and has the opportunity to strengthen, along with Indonesia's solid economic fundamentals, controlled inflation, attractive yields, and prospects for continued economic growth.
"The steps to stabilize the rupiah exchange rate that we have increased are also supported by the adequacy of foreign exchange reserves. Our foreign exchange reserves are quite large and more than enough to stabilize the rupiah exchange rate," he explained.
"Indeed, our foreign exchange reserves are collected when we enter and we use them, we do not hesitate to use foreign exchange reserves to stabilize the rupiah exchange rate," he added.
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