TEMPO.CO, Jakarta - The Indonesian rupiah appreciated to Rp16,205 per US dollar in trading on Tuesday, July 8, 2025. This marks a rebound from the previous closing, when the currency had weakened by 40 points to Rp16,239.
Currency analyst Ibrahim Assuaib said several global factors contributed to the US dollar’s decline, which in turn supported the rupiah.
One of the key concerns in global markets is the potential return of a trade war, following US President Donald Trump’s recent announcement of import tariffs on South Korea and Japan.
“He (Trump) accused both countries of maintaining unfair trading practices, including high import taxes and non-tariff barriers,” Ibrahim said in a written statement on Tuesday.
He noted that investor anxiety is rising as markets await the official deadline for new US tariffs on July 9. Trump is expected to unveil tariffs of up to 70 percent, targeting over 100 countries.
Ibrahim explained that the uncertainty surrounding Trump’s tariff plan has triggered demand for the US dollar, as markets fear the policy could lead to inflation in the United States.
At the same time, strong US economic data makes it unlikely that the Federal Reserve will cut interest rates in the near future, further influencing currency movements.
Domestically, the rupiah’s strengthening was also influenced by Trump’s tariff announcement directed at Indonesia. The United States has confirmed a 32 percent reciprocal import tariff on Indonesian products, set to take effect on August 1.
However, Ibrahim said the delayed implementation offers Indonesia more time to negotiate. “Trump’s decision is seen by many as causing market uncertainty,” he said.
Beyond economics, Ibrahim argued that the tariffs also reflect a broader geopolitical strategy. He believes the U.M. is using the policy to shift the dynamics of bilateral trade, prompting Indonesia to reassess its export strategy and trade diplomacy.
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