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Rupiah weakens as Bank Indonesia governor resigns, USD/IDR steadies near 18,050
USD/IDR was around 18,050 in Asian hours after rebounding from the prior session, while traders also weighed renewed Red Sea supply risks and expectations the Fed will hold rates on Wednesday.
The Indonesian rupiah faced renewed pressure after Bank Indonesia Governor Perry Warjiyo resigned unexpectedly, lifting USD/IDR from its prior-session losses and keeping the pair near 18,050 during Asian trading on Monday, according to FXStreet.
FXStreet reported that Destry Damayanti was appointed interim governor, with Warjiyo stepping down for personal reasons. The move was expected to unsettle investors and revive concerns about central bank independence.
FXStreet also tied the currency outlook to shifting risk sentiment. It noted that geopolitical tensions eased after a weekend pause in US and Iran military hostilities, but uncertainty persisted after Iran-backed Houthis in Yemen claimed responsibility for attacks on Saudi facilities in the Red Sea.
Looking ahead, FXStreet said markets expect the Federal Reserve to hold interest rates steady on Wednesday before resuming rate hikes in September. Traders are also watching advance Q2 GDP, PCE inflation, and upcoming earnings reports from major US corporations for further guidance on the economic backdrop.