Internal factors<\/strong><\/h5>\n\nDomestic challenges have also intensified the pressure on the rupiah. Political uncertainty, falling commodity prices, and inconsistent policymaking have shaken investor confidence. As capital exits the market, the national currency comes under additional strain.<\/p>\n\n
This depreciation has had a pronounced impact on businesses reliant on imported materials. As import costs rise, domestic production becomes more expensive, triggering inflationary pressure across sectors.<\/p>\n\n
\u201cWhen the rupiah weakens, the cost of importing industrial inputs increases,\u201d Prof. Mawardi said. \u201cThis drives up production expenses and contributes to cost-push inflation\u2014price hikes caused by rising operational costs.\u201d<\/p>\n\nProfessor Dr. Imron Mawardi, S.P., M.Si., an economist from 东京热\u2019s Faculty of Economics and Business. (Photo: Source archive)<\/figcaption><\/figure>\n\nIndonesia\u2019s economic potential<\/strong><\/h5>\n\nStill, Prof. Mawardi expressed cautious optimism about Indonesia\u2019s long-term investment prospects, despite growing competition from countries like Vietnam. He cited the nation\u2019s large consumer base and strong market appeal. However, to maintain its edge, Indonesia must create a more stable and attractive business environment. This includes offering targeted incentives to foreign investors and adopting more consistent economic policies. <\/p>\n\n
He also underscored the critical role of the government and Bank Indonesia (BI) in ensuring currency stability. \u201cThe government needs to strengthen exports and attract foreign investment through structured efforts,\u201d he noted. \u201cAt the same time, BI should actively intervene to manage short-term exchange rate volatility.\u201d<\/p>\n\n
Public\u2019s role<\/strong><\/h5>\n\nProf. Mawardi emphasized that the public, too, plays a part in stabilizing the rupiah. \u201cPeople should avoid panic-buying foreign currencies like the U.S. dollar,\u201d he advised. \u201cSupporting locally made products can also help reduce reliance on imports and stimulate the national economy.\u201d <\/p>\n\n
In a climate of economic uncertainty, safeguarding stability requires collaboration among the government, business community, and the public. Boosting exports, maintaining consistent policy direction, and encouraging support for domestic goods are key to addressing the ongoing depreciation of the rupiah.<\/p>\n\n
Author: Rosali Elvira Nurdiansyarani<\/p>\n\n
Editor: Khefti Al Mawalia<\/p>\n","protected":false},"excerpt":{"rendered":"
UNAIR NEWS \u2013 The continued decline of the Indonesian rupiah has raised serious concerns about the country\u2019s economic outlook. Beyond increasing import costs, the weakening exchange rate signals underlying domestic vulnerabilities and undermines investor confidence. According to Professor Dr. Imron Mawardi, S.P., M.Si., an economist from 东京热\u2019s Faculty of Economics and Business, both global […]<\/p>\n","protected":false},"author":79,"featured_media":349473,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"footnotes":""},"categories":[48,50,88],"tags":[178,168],"class_list":["post-349562","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-experts","category-news-en-2","category-news-feb-en","tag-unair-en","tag-universitas-airlangga-en"],"yoast_head":"\n
Rupiah slumps further, UNAIR economist highlights key drivers<\/title>\n \n \n \n \n \n \n \n \n \n \n \n \n \n\t \n\t \n\t \n \n \n \n \n \n\t \n\t \n\t \n