The USD/IDR currency pair extended its losses for a second consecutive day, trading around 17,820 during Asian hours on Wednesday, as market participants awaited the Bank Indonesia (BI) interest rate decision scheduled for later in the day [1]. Technical analysis indicates that the pair remains within an ascending channel, maintaining a mildly bullish near-term bias, with spot prices above both the nine- and 50-day Exponential Moving Averages (EMAs) [1]. The 14-day Relative Strength Index (RSI) stands at 54.08, suggesting a positive momentum without entering overbought territory, while the FXS Fed Sentiment Index is elevated at 148.39, reflecting ongoing external dollar-supportive factors [1].
Analysts note that the USD/IDR could potentially rebound toward the upper boundary of the ascending channel at 18,060, and possibly retest the all-time high of 18,247, which was reached on June 8 [1]. On the downside, immediate support is seen at the 50-day and nine-day EMAs of 17,804 and 17,800, respectively, with a break below these levels potentially opening the way to the four-month low of 17,476, recorded on September 9 [1].
From a fundamental perspective, OCBC analysts highlight Indonesia's continued fiscal prudence, with the January-August deficit contained at 0.93% of GDP [1]. The government is also taking steps to safeguard financial stability by maintaining at least IDR200 trillion of funds in state-owned banks until July 2027 [1]. Finance Minister Suahasil Nazara has reassured markets that any subsequent withdrawal of these funds would be communicated carefully to avoid disrupting financial stability, reinforcing expectations of policy continuity and disciplined fiscal management [1].
No immediate market reaction or analyst opinions regarding the outcome of the upcoming BI decision are provided in the article. However, the technical and fundamental backdrop suggests a cautious but stable outlook for the Rupiah, underpinned by fiscal discipline and proactive policy measures [1].
CONCLUSION
The USD/IDR pair is trading near key technical support levels as markets await the Bank Indonesia rate decision. Indonesia's fiscal discipline and government measures to ensure banking sector stability are providing support for the Rupiah. The market remains cautiously optimistic, with the potential for further movement depending on the central bank's policy announcement.