Finance Minister Purbaya Yudhi Sadewa addressed the recent drop in the rupiah exchange rate, which briefly fell to IDR 16,700 per U.S. dollar.
He believes the currency’s weakness is only temporary.

“I am confident the rupiah will return to its fundamental level,” Purbaya said during a media briefing at the Ministry of Finance office on Friday (Sept 26).

He expressed confidence that the rupiah would strengthen in line with the injection of IDR 200 trillion into the banking sector, which is expected to stimulate the broader economy.

As economic activity picks up, Purbaya is convinced that foreign capital will flow in, not only through the capital market but also through direct investment (FDI).

“Foreign investors will definitely come, not just in the capital market or for the short term, but gradually into FDI as well. The real driver isn’t high interest rates, but rather the economic outlook for the future,” he explained.

He continued, “The capital market is more responsive. Once they see our policies in action, they will recognize the credibility and start investing first.”

Furthermore, Purbaya is optimistic that the rupiah will strengthen again as early as next week.

“By midweek, it should already rebound. This press conference is just happening now, and the news will only be read in the evening when the market is closed. By Monday, then Tuesday or Wednesday, I expect the rupiah to be back on track,” he concluded.