Antara News·Indonesia·Monday, October 19, 2026 at 03:53 PM UTC

Bank Indonesia steps up market intervention to shield rupiah

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Aditya Ramadhan, Yashinta Difa

Jakarta (ANTARA) - Bank Indonesia (BI) is strengthening its measures to stabilize the rupiah exchange rate through various market intervention instruments to mitigate the impact of high global economic volatility on the domestic economy.

"Essentially, Bank Indonesia will always remain present in the market," BI Governor Destry Damayanti stated following a limited cabinet meeting on economic affairs at the Presidential Palace complex in Jakarta on Monday.

Destry explained that President Prabowo Subianto has instructed the central bank to continue its efforts and monitor the effectiveness of various stabilization policy instruments that have been prepared.

These steps include interventions in both the spot market and through Non-Deliverable Forwards (NDF), as well as the provision of hedging cost incentives which have been implemented since the end of last June.

According to Destry, these incentives and interventions have proven to have a positive impact on domestic financial market movements, particularly in attracting liquidity amid uncertainty over global interest rates.

To date, these measures have successfully attracted capital inflows through swap instruments and Domestic Non-Deliverable Forwards (DNDF) totaling approximately US$8 billion to US$8.5 billion.

While defending the currency remains a primary focus, BI continues to pay close attention to inflation control as a reflection of the current national economic condition.

Destry reported that the core inflation rate in September remained well-contained at 2.8 percent. Nevertheless, the central bank remains vigilant regarding inflation in the volatile food category, which has reached 5 percent.

To rein in food price pressures, BI is deepening coordination with the Agriculture Ministry to bring volatile food inflation back within the central bank's target range of 2.5 percent, plus or minus one percent.

Addressing external challenges, Destry highlighted high global volatility driven by the "higher-for-longer" interest rate environment in developed nations, where inflation rates remain above their respective targets.

She added that although the probability of a US Federal Reserve rate hike is expected to be lower this October, the situation remains a challenge that continues to be monitored to safeguard the resilience of the rupiah.

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