The rupiah has fallen to below 17,400 to the greenback, prompting authorities to take measures to defend the currency, including tightening rules for dollar purchases.

The rupiah’s exchange rate “has been kept at a level comparable to other countries,” central bank governor Perry Warjiyo told reporters in Jakarta.

“Currencies across the world are weakening. We are making sure that the degree of depreciation does not become too large by taking all-out measures.”

Perry said that the rupiah’s weakening was driven in part by seasonal factors, including strong dollar demand for corporate dividend payments and for hajj pilgrims travelling abroad.

He said Bank Indonesia will continue defending the currency, including further tightening rules for dollar purchases.

Since April, buyers of more than US$50,000 in a given month must provide supporting documents to justify their need for greenbacks. The level was previously US$100,000.

The threshold will be slashed again to US$25,000, said Perry, without giving a date.

The governor insisted the rupiah was “undervalued”, citing strong economic fundamentals including strong GDP numbers.

Perry added that the archipelago’s external economic resilience “remains strong in the face of rising global uncertainty, including the fallout of the Middle East conflict”.

The Indonesian economy grew 5.61% year-on-year in the first quarter of 2026 – the strongest expansion since the third quarter of 2022, according to the national statistics agency.

The number, fuelled in large part by by strong household and government spending, was achieved despite rising global oil prices.

Indonesia is an oil producer but a net importer, and Jakarta insists on leaving subsidised fuel prices unchanged.