Rupiah Weakens as Market Reels from Finance Minister Shake-Up

The Indonesian rupiah slipped to around 16,480 per dollar on Tuesday morning before recovering slightly after the central bank confirmed it was intervening in the market to stabilize the local currency. Pressure on Indonesian assets mounted following the sudden removal of Sri Mulyani Indrawati as finance minister Monday, a move that unsettled investors given her reputation for fiscal prudence and global credibility. Her exit came just days after the country was rocked by its largest anti-government protests in years, adding to political and economic uncertainty. Newly appointed finance minister Purbaya Yudhi Sadewa pledged to safeguard Indonesia’s fiscal health, but markets remain cautious. So far this year, the rupiah has fallen 2.3% against the US dollar, making it Asia’s second-worst performing currency after the Indian rupee. Meanwhile, the dollar index steadied at 97.4, near its weakest in almost seven weeks, as soft US labor data fueled bets of imminent Federal Reserve rate cuts.