Indonesian Rupiah Falls to Record Low as Energy Costs Surge
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Jakarta: Indonesia's rupiah has fallen to its weakest level on record against the US dollar, crossing the key 18,000 mark as rising energy prices and global uncertainty weigh on the economy.
The currency dropped to 18,028 per dollar on Thursday despite recent measures by Bank Indonesia to support it.
Analysts say higher oil prices, driven by the conflict involving the United States, Israel and Iran, have increased pressure on energy-importing countries such as Indonesia. The situation has raised demand for dollars while reducing the country's trade surplus.
Indonesia's trade surplus narrowed sharply to just $89 million in April from $3.3 billion a month earlier, adding to pressure on the currency.
The central bank recently raised interest rates to 5.25 percent and tightened rules on large dollar purchases, but economists say those steps have so far failed to halt the rupiah's decline.
Additional US tariff proposals targeting dozens of economies, including Indonesia, have also added to investor concerns and market volatility.
Pic Credit: AFP
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