The rupiah weakened against the US dollar in trading on Wednesday, February 18, 2026, influenced by hawkish statements from Federal Reserve officials and US economic data. Analysts predict fluctuations with levels around Rp16,800-Rp16,900 per US dollar. Bank Indonesia is likely to hold interest rates amid this pressure.
In early trading in Jakarta, the rupiah exchange rate weakened by 18 points or 0.11 percent to Rp16,855 per US dollar from the previous Rp16,837, according to currency analyst Lukman Leong of Doo Financial Futures. By 09:02 WIB, the rupiah was traded at Rp16,863 per US dollar, down 26 points or 0.15 percent from Rp16,837. Bank Indonesia's Jakarta Interbank Spot Dollar Rate (Jisdor) showed the rate at Rp16,844 per US dollar on Friday, February 13, 2026, weakened by 18 points from Rp16,826 on the previous Thursday.
Lukman Leong stated that the weakening follows hawkish comments from Federal Reserve officials, including Deputy Governor Michael Barr and San Francisco Fed President Mary Daly. Daly noted that inflation still needs to be lowered as it has not reached the target and the job sector remains fluctuating. Barr said Fed rates will hold steady for some time. The CME FedWatch Tool reported the probability of the Fed maintaining rates at the March 2026 FOMC meeting rising to 94 percent from 80 percent.
Economist observer Ibrahim Assuaibi added that uncertainty over US rate cuts is a major burden, especially after January payroll data showed labor market resilience. Market focus is on the US Consumer Price Index (CPI) inflation data for January 2026, to be released this Friday. "Labor market strength and inflation are the two biggest considerations for the Federal Reserve on interest rates," Ibrahim said in his daily research.
Domestically, investors anticipate a dovish stance from Bank Indonesia at its Thursday, February 19, 2026, meeting, though it is likely to hold rates due to rupiah pressure. Geopolitical factors, such as Donald Trump's Iran nuclear negotiations and a Ukrainian drone attack on a Russian Lukoil oil refinery, also influence sentiment, though Middle East risks have eased.
