DIGIVESTASI - US Dollar Strengthens, Rupiah Weakens: Government Urged to Be Cautious. The recent strength of the US Dollar has caused the value of the Indonesian Rupiah to plummet. Senior economist and Professor of Economics and Business at the University of Indonesia (UI), Telisa Aulia Falianty, has urged the government, Bank Indonesia, and relevant authorities to exercise extra caution in managing the Rupiah.

Telisa noted that if the exchange rate of the dollar against the Rupiah hits Rp 17,000/USD, the economic impact on the Indonesian public will be significant, although it will not be as severe as the monetary crisis of 1997-1998.

"Previously, the overshoot was from Rp 5,000 to Rp 17,000. Now it's from Rp 14,000 to Rp 17,000, so it's not yet a crisis. A crisis might occur if it reaches Rp 20,000," Telisa told CNBC Indonesia on Sunday (June 30, 2024).

Telisa also warned the government and monetary authorities not to let the Rupiah exchange rate breach the Rp 16,500/USD level. She argued that if this psychological level is crossed from around Rp 16,400/USD, negative market sentiment will continue to rise, become difficult to tame, and potentially fall to Rp 17,000/USD.

"There is a probability of reaching Rp 17,000/USD. After Rp 17,000, there might be a new equilibrium," Telisa explained.

During a working meeting with Bank Indonesia (BI) on Monday (June 24, 2024), Member of Commission XI from the PDIP faction, Eriko Sotarduga, expressed his surprise at the recent pressure on the Rupiah. He believes that the pressure on the Rupiah cannot be taken lightly.

"Going forward, evaluations need to be more frequent, perhaps once a month. This cannot be considered as a normal situation," he said on Tuesday (June 25, 2024).

"What if it reaches Rp 17,000, Rp 18,000, or Rp 20,000? These scenarios need to be prepared for. Mrs. Destry and her colleagues are very experienced, what steps will be taken in a situation where the current government is ending and a new one is transitioning?" he concluded.

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