Rupiah Opens Weaker as Trump Signals Openness to Trade Deal with China

• The rupiah opened at Rp16,561 per US dollar, up 0.07 percent from the previous close.

• Trump’s openness to a trade deal with China eased tensions and supported the strengthening of the rupiah.

• The chance of a 25 bps interest rate cut this month reached 95 percent, supporting market sentiment despite the delay in the release of US economic data due to the government shutdown.

Jakarta – The rupiah exchange rate strengthened at the start of trading today, Tuesday (10/14/2025). The rupiah opened at Rp16,561 per US dollar, or a slight 0.07 percent stronger than yesterday’s closing at Rp16,588 per US dollar.

Bank Mandiri Chief Economist Andry Asmoro said President Donald Trump’s administration signaled openness to a trade deal with China, despite rising tensions over Beijing’s new export controls.

“This move follows Trump’s announcement on Friday of a 100 percent tariff imposed across the board on all Chinese imports from November 1 to November 2025, in response to China’s restrictions on rare earth exports,” Andry said on Tuesday, October 14, 2025.

Meanwhile, the US dollar index (DXY) rose above 99, recovering losses from the previous session when Trump withdrew his threat to impose massive tariffs on China, saying in a post on Truth Social that trade relations with the country “will be fine.”

Vice President JD Vance agreed, stating that the US is ready to negotiate if Beijing is “willing to be reasonable.”

Investors also digested the University of Michigan’s preliminary consumer sentiment report, which showed no change in October 2025, but slightly above expectations.

“The US government shutdown is expected to continue and likely delay the release of key economic data such as CPI and employment data that could affect the prospects for a Federal Reserve interest rate cut,” he added.

Andry said that the market currently estimates a 95 percent chance of a 25 bps interest rate cut this month, while the chance of a cut in December 2025 has decreased to 80 percent from 90 percent.

“Our view is that the rupiah will move in the range of Rp16,540 and Rp16,633 per US dollar today,” added Andry. (*)