Commodity policy jitters drag Jakarta stocks; rupiah near historic lows
Jakarta stocks are set for their steepest weekly decline since March 2020 after eight straight sessions of losses, while the Indonesian rupiah hovers near a historic low at 17,720 per dollar.
Source: The Star · July 21, 2026 at 1:25 PM · AI-assisted report
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JAKARTA, 21 JULY 2026 —
Jakarta stocks are set for their steepest weekly decline since March 2020 after eight straight sessions of losses, while the Indonesian rupiah hovers near a historic low at 17,720 per dollar.
Market Impact
The benchmark Jakarta Composite Index fell more than 15% over the eight-day stretch through Thursday, according to market data. By Friday’s close, it was down about 29% this year, according to the exchange’s data. The rupiah weakened 0.5% to 17,720 per dollar at 0654 GMT, within 25 pips of the record low of 17,745 reached earlier in the week.
Bank Indonesia’s surprise 50-basis-point rate hike this week aimed to defend the currency amid pressure from higher oil prices, stronger U.S. yields and a stronger dollar, all of which weigh on import-reliant economies, the central bank said in a statement. The move followed an announcement of plans to centralise exports of key commodities, which has raised concerns about sales disruptions and weaker earnings in the foreign-exchange-earning sector.
Chandresh Jain, emerging market Asia rates and FX strategist at BNP Paribas, said the central bank’s decision reflects efforts to curb export value manipulation but may be seen negatively by private firms concerned about tighter controls. “The high yield environment globally is generally not good for IDR,” Jain said. “Markets could test BI at future meetings by pushing dollar/rupiah and bond yields higher.”
Foreign investors have sold Indonesian equities aggressively this year, with the benchmark down nearly 29% year-to-date, exchange data shows. The exchange said Friday’s 0.4% gain reflected bargain-hunting after the steep selloff, though the weekly loss remains intact.
Elsewhere in the region, the South Korean won weakened 0.6% to 1,517 per dollar and has fallen over 5% this year, traders said. The Philippine peso was little changed but has lost nearly 5% year-to-date amid inflation concerns that keep policy tightening expectations alive.
The Indian rupee held steady after a stretch of record lows, with traders citing likely dollar-selling intervention by the Reserve Bank of India. In Turkey, the BIST 100 index snapped four sessions of losses to rise 1.5% on Friday, after dropping 6% in the prior session and triggering a circuit breaker, though the lira was little changed on the day.
In equities, Taiwan stocks jumped over 2% on Nvidia-driven gains, while South Korean shares added 0.4%. Bourses in China, Manila, Kuala Lumpur and Singapore also advanced, supported by regional bargain-hunting.
Related: IDX · Jakarta