Importantly, the country’s current account surplus has increased to 1.2% of GDP in Q1, the highest since Q2 2010. This has reduced the country’s reliance on capital flows and resulted in reduced volatility in the currency. 

Export performance has started to weaken recently due to a dip in external demand and lower global commodity prices. This may halt the increase in the current account, but an overall balance of payments surplus for 2023 will ensure that IDR resilience can be maintained.

We see the Rupiah continuing to benefit from carry demand and see scope for further gains.

USD/IDR (end of period) – 2023 14,200 2024 13,900 2025 13,900