THAILAND: Indonesia’s rupiah sank below 17,500 per dollar on Tuesday amid a weakness in emerging Asian currencies as the ongoing stalemate in US-Iran peace talks kept oil prices high and risk-taking low.
The Philippine peso dipped 0.9percent in its third straight session of losses, while the Indonesian rupiah weakened to an all-time low of 17,525 against the US dollar.
The peso and the rupiah have declined nearly 5percent and 7percent, respectively, since the war in the Middle East began in late February.
“In Asia, the Indonesian rupiah remains under pressure… as lingering energy disruptions raise the risk of fuel shortages,” said MUFG senior currency analyst Lloyd Chan.
“Indonesia’s vulnerability is heightened by relatively low crude inventory buffers, largely due to storage capacity constraints.”
The 10-week-long conflict in the Middle East has battered currencies across energy-reliant Asian economies, prompting central banks and governments to scramble and roll out measures to curb currency weakness, though with limited success.
Indonesia’s benchmark stock index shed as much as 2.1percent to its lowest since late June 2025, with heavy losses in utilities firm Barito Renewables and chemicals firm Chandra Asri Pacific.
Alongside energy shocks, Indonesia is grappling with concerns over fiscal discipline, central bank independence, and stock market regulation.
Market participants are now awaiting MSCI’s May review later in the day, where the index provider is expected to maintain curbs on Indonesian stocks.
This follows a market rout in January after MSCI warned that Indonesia could be downgraded to frontier-market status, citing concerns about transparency.
Local media reports cited the country’s financial regulator chair saying that regulators anticipate various scenarios, including changes in weighting and the removal of certain Indonesian companies from MSCI indices.
Meanwhile, the Indian rupee hit an all-time low of 95.738 on Tuesday, weighed down by expectations of prolonged high crude prices, persistent portfolio outflows and weakening sentiment.
MSCI’s EM Asia equities gauge declined 0.5percent, dragged down by a 2.3percent drop in South Korea’s tech-heavy KOSPI index.
The benchmark had climbed to a record high earlier in the session and nearly tested the 8,000 level before pulling back sharply, as investors booked profits.
Chipmaker Samsung Electronics and peer SK Hynix declined between 2percent and 3percent.
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