Indonesian Rupiah Faces Significant Depreciation

Currency Performance and Capital Outflow

The Indonesian Rupiah has experienced a substantial decline, becoming the second-worst performing currency in Asia year-to-date (YtD), with a depreciation of 3.44% against the US Dollar as of November 14, 2025. This performance is particularly notable when compared to other Asian currencies, with only the Indian Rupee performing worse at -3.52%. The Malaysian Ringgit, in contrast, has been the best performer in the region with an 8.22% appreciation against the US Dollar.

The depreciation of the Rupiah has been accompanied by significant capital outflows from Indonesia's financial markets. According to Bank Indonesia, there was a total capital outflow of Rp184.09 trillion between January 1 and November 13, 2025. This outflow was primarily driven by net sales of Rp37.24 trillion in the stock market, Rp140.40 trillion in Bank Indonesia's Rupiah Securities (SRBI), and Rp6.45 trillion in Government Bonds (SBN).

Financial Market Impact

The capital outflow has had implications for Indonesia's financial markets. The 5-year credit default swap (CDS) premium for Indonesia stood at 73.51 basis points as of November 13, 2025, showing some improvement from 76.05 basis points on November 7, 2025. Meanwhile, the yield on 10-year Government Bonds (SBN) remained stable at 6.12% on November 14, 2025, consistent with the previous day's level.

Bank Indonesia's Response

In response to these developments, Bank Indonesia has maintained a robust foreign exchange reserve position. As of October 2025, the country's foreign exchange reserves stood at $149.9 billion, up from $148.7 billion in the previous month. This increase was attributed to the issuance of global bonds by the government, tax receipts, and service revenues. According to Ramdan Denny Prakoso, Executive Director of Bank Indonesia's Communication Department, the foreign exchange reserves are equivalent to 6.2 months of import coverage, exceeding the international adequacy standard of around 3 months of imports.

Market Movement

On November 14, 2025, the Rupiah opened stronger at Rp16,690 per US Dollar, compared to Rp16,720 per US Dollar at the close of the previous trading day. This movement reflects the ongoing dynamics in the currency market as investors react to both domestic and international economic developments.