Indonesian Rupiah Becomes Asia's Third-Weakest Currency by the End of March 2025

The weakening of the Indonesian Rupiah (IDR) against the US dollar continues.

Based on data from Asian Bonds Online, the Rupiah's position was among the three lowest on Wednesday, March 25, 2025, with an exchange rate of 16,612 IDR per US$.

Asian Bonds Online also recorded a year-to-date (YTD) weakening of the Rupiah by 2.89% since the beginning of the year. This percentage is the deepest compared to other Asian currencies.

Other weak currencies include the Vietnamese Dong (VND) at 25,630 per US$ and the Lao Kip (LAK) at 21,654.23 per US$.

Meanwhile, the strongest currencies in the Asian zone are the Brunei Darussalam dollar (BND) and the Singapore dollar (SGD), both at 1.34 per US$.

(Read also: IHSG Falls, Rupiah Weakens)

Impact of Rupiah Weakening

Bhima Yudhistira, Executive Director of the Center of Economic and Law Studies (Celios), revealed that the implications of this Rupiah weakening are far-reaching. He stated that the weakening impacts the state budget (APBN) and the public directly.

Bhima cited energy subsidy spending as the most affected. Spending on electricity subsidies, fuel (BBM), and 3-kilogram LPG will inevitably increase.

"Energy subsidy spending in the first 100 days of the Prabowo-Gibran administration is significantly higher than previous administrations," said Bhima to Katadata.co.id on Tuesday, March 25.

This means the burden will pressure the APBN amidst declining tax revenue. Ultimately, the budget deficit will continue to widen.

Bhima said the Rupiah's weakening will also impact the public. The weakening will increase the cost of importing raw materials and finished goods, leading producers and traders to pass on higher prices to consumers.

"This will create imported inflation and further reduce public purchasing power," said Bhima.

The retail sector will also be affected by the Rupiah's weakening. This is because consumers will bear the brunt of higher import prices.

"Retailers also worry that consumers are not prepared for higher prices, so their turnover could plummet," said Bhima.

Furthermore, Eko Listiyanto, Executive Director of the Institute for Development of Economics and Finance (Indef), said the Rupiah's weakening has the potential to disrupt economic stability in the short term.

"Economic stability, if the Rupiah fluctuates, will also have implications for our macroeconomy," said Eko in an online Indef discussion.

In his opinion, players in the money market will also be observing the situation during the 2025 Eid al-Fitr holiday. During this period, the amount of money in circulation and the number of travelers are projected to increase significantly.

(Read Katadata: Rupiah Weakening and its Series of Risks to the Indonesian Economy)