TEMPO.CO, Jakarta - The Indonesian currency rupiah strengthened to the level of 16,350 per U.S. dollar at the close of trading on Friday, March 14, 2025.  However, analysts predict a potential weakening in the upcoming trading session on Monday, March 17, 2025.

The currency gained 78 points from its previous closing level of 16,428 per U.S. dollar. Currency observer Ibrahim Assuaibi noted that the rupiah is likely to experience fluctuations.

"For Monday's trading, the rupiah is expected to fluctuate but close weaker, ranging between 16,340 and 16,400 per U.S. dollar," he stated in his routine analysis on Friday, March 14, 2025.

Meanwhile, the Jakarta Interbank Spot Dollar Rate (Jisdor) recorded the rupiah at 16,392 per U.S. dollar by today’s close, strengthening from the previous day’s rate of 16,428 per U.S. dollar.

The rupiah’s expected decline aligns with the strengthening U.S. dollar index. According to Assuaibi, global market sentiment has been affected by President Donald Trump’s threat to impose a 200 percent tariff on European alcoholic beverages, including wine and champagne, in response to the European Union's decision to levy a 50 percent tariff on American whiskey.

The EU’s move, set to take effect on April 1, is a reaction to the recent US-imposed 25 percent tariff on imported steel and aluminum.

"Furthermore, Trump is expected to implement retaliatory tariffs worldwide on April 2, which could further dampen investor sentiment," Assuaibi explained.

Adding to the mix, recent US economic data showed weaker-than-expected inflation. Both the Consumer Price Index (CPI) and the Producer Price Index (PPI) indicated lower inflationary pressure, fueling expectations that the Federal Reserve may consider cutting interest rates by the end of the year.

The Federal Reserve is set to convene on March 18-19, 2025, to discuss monetary policy. Analysts widely anticipate that interest rates will remain unchanged due to persistent inflation concerns and ongoing trade tensions.

Meanwhile, China's central bank, the People’s Bank of China (PBoC), has announced plans to introduce additional monetary measures to stimulate economic growth. These efforts may include interest rate reductions and strategies to maintain currency stability amid global economic challenges.

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