Indonesian Banking Sector Maintains FX Liquidity Amid Currency Fluctuations

Strong FX Deposits Position

Indonesian banks have successfully maintained robust foreign currency (FX) liquidity despite Rupiah fluctuations, with FX third-party funds reaching Rp1,357 trillion by November 2025 ¹

. This represents a 0.22% monthly growth, indicating continued confidence in the banking system's ability to manage currency risks. The strong liquidity position has enabled banks to continue lending activities without significant constraints.

Interbank Market Dynamics

The interbank FX market experienced a significant decline in transaction volume, with transactions dropping 39.13% to US$59.65 million in the same period ¹

. According to the Lembaga Penjamin Simpanan (LPS), this decrease reflects reduced short-term FX funding demand from banks amid limited capital inflows. The LPS assessment suggests that banks are managing their FX liquidity prudently in the current market environment.

Market Expert Analysis

Moch Amin Nurdin, Advisor at Banking & Finance Development Center, noted that FX liquidity has been challenging since mid-2025 due to decreased foreign exchange inflows, partly resulting from tariff policies and global commodity price corrections. Despite these challenges, the banking sector has maintained sufficient FX liquidity to support their operations and lending activities.

Implications for Banking Sector

The current liquidity position suggests that Indonesian banks are well-positioned to manage currency fluctuations while continuing their lending activities. The combination of strong FX deposits and prudent liquidity management indicates a stable foundation for the banking sector amid challenging external conditions.