Indonesia’s foreign exchange reserves remained stable in July despite global turbulence and the impact of new U.S. import tariffs.

Bank Indonesia (BI) reported reserves of US$152.0 billion at the end of July, only slightly lower than June’s US$152.6 billion.

Executive Director of BI’s Communication Department, Ramdan Denny Prakoso, said the decline reflected external debt payments and the central bank’s efforts to stabilize the rupiah amid heightened global uncertainty.

“This level of foreign exchange reserves is considered very adequate as it is equivalent to 6.3 months of import financing, above the international standard of 3 months of imports,” said Ramdan, Thursday (August 7).

Reserves have stayed resilient even as trade activity slowed earlier this year, with exporters and importers holding back decisions while waiting for clarity on U.S. tariff hikes. Washington initially signaled a 32% rate before revising it to 19%, effective August 7.

From April to July, reserves fluctuated only slightly, from US$152.46 billion in April to US$151.98 billion in July.

Bank Mandiri Chief Economist Andry Asmoro said steady tax revenues and service-sector inflows helped offset debt payments and currency interventions.

"Nevertheless, the position of foreign exchange reserves remains high and demonstrates resilience against Indonesia’s external sector,” said Asmoro.

Outlook Ahead

Asmoro said Indonesia’s foreign exchange reserves are expected to remain strong, supported by the trade surplus and the prospects for capital inflows into emerging markets. Indonesia itself has recorded a trade surplus for 62 consecutive months.

An economist from the Institute for Economic and Social Research, University of Indonesia (LPEM UI), Teuku Riefky, projected that Indonesia’s foreign exchange reserves will face pressure toward the end of the year.

He said that global economic factors are the cause of the decline in reserves.
“If we look at the impact of Trump’s Tariffs, there will certainly be pressures on the rupiah, which in turn reduces Indonesia’s foreign exchange reserves,” he told Suar (8/7/2025).

On the other hand, he predicted that BI would intervene by using foreign exchange reserves to maintain the stability of the rupiah exchange rate.

Chairman of the Indonesian Exporters Association (GPEI), Benny Soetrisno, said that although the gap between exports and imports has narrowed, Indonesia’s trade balance remains in surplus. He also added that foreign exchange reserves are currently strengthened by a policy requiring exporters of natural resource (NR) products to retain their export proceeds (DHE) for 12 months.

However, he argued that the mandatory DHE retention policy is less appropriate for processing industry exporters. This is because many raw materials for the manufacturing industry still need to be imported. Export earnings are often immediately used to purchase raw materials, which are then quickly allocated for production needs.

This policy is indeed more suitable for DHE derived from natural resources, as this sector’s export proceeds can be kept longer within the domestic financial system.

Nevertheless, potential pressures going forward still need to be closely monitored, especially from the U.S. tariff policy that imposes a 19% import duty on Indonesian products, which could affect national export performance. Key commodities such as coal and CPO are expected to remain the main pillars of Indonesia’s external resilience.

Benny also emphasized the importance of rupiah stability for businesses. According to him, a stable rupiah supported by strong reserves allows entrepreneurs to calculate exchange rate risks more accurately and avoid losses.
“Our hope is for the rupiah to remain stable. Its fluctuations should not be too high or too low, so that we can calculate currency risks properly,” he told SUAR on August 7.

To strengthen business resilience, Benny suggested that the government lower hedging costs, an instrument used to maintain exchange rate certainty. However, he considered hedging costs in Indonesia to still be too expensive at present.