Bank Indonesia May Defend Rupiah Amid Volatile Oil, Analysts Say

Indonesia’s central bank may continue to defend the rupiah around a key threshold as volatile oil prices, a stronger dollar and risk-off flows tied to the Iran conflict deepen concerns over the nation’s investment appeal.

Bank Indonesia is expected to keep intervening to hold the rupiah below the psychologically important 17,000 per dollar mark, according to analysts. Uncertainty over how long the war may last is compounding Indonesia’s existing economic concerns, while elevated crude prices risk stoking inflation in the net oil-importer.