27.07.202602:20:00UTC+00Rupiah Slides as BI Governor Steps Down

The Indonesian rupiah weakened to around IDR 17,980 per U.S. dollar on Monday morning, after briefly firming near 17,900 in the previous session, pressured by the unexpected resignation of Bank Indonesia Governor Perry Warjiyo. President Prabowo accepted the resignation before markets opened, State Secretariat Minister Prasetyo Hadi said. Senior Deputy Governor Destry Damayanti, appointed as interim governor, stated that Warjiyo stepped down for personal reasons. Analysts warned that the surprise move could unsettle investors already worried about fiscal risks and the central bank’s independence. Warjiyo, who began his second five-year term in 2023, had come under growing pressure to align monetary policy more closely with the government’s pro-growth agenda as the rupiah hit record lows in June. Last week, the central bank left its benchmark interest rate unchanged at 5.75%, against market expectations for another increase following a total of 100 basis points of hikes since May. On the global front, the U.S. dollar softened as oil prices fell after a pause in U.S.–Iran hostilities, easing concerns over supply disruptions and inflation.