Trade War Starts Tomorrow, Rupiah Projected To Be Battered

The policy of the President of the United States (US), Donald Trump, who will apply import tariffs to all countries, has opened up new concerns for the Indonesian economy. The full statement on tariffs, which is planned to be announced on Wednesday, April 2, 2025, could affect the movement of gold prices and further weaken the Rupiah. 

Currency observer, Ibrahim Assuaibi, said that Trump's policy could trigger a soaring gold price. Not only that, Ibrahim said, Trump's policy also has the potential to weaken the Rupiah and the Composite Stock Price Index (IHSG). 

"I have fears that the rupiah will approach Rp17 thousand (per US$1). Because we know that the market is also still closed until April 7. Bank Indonesia is also not intervening in the market. It is likely that the rupiah will also weaken," Ibrahim told detikcom, Tuesday (1/4/2025). 

"From this policy, what will definitely be felt later are imported goods. Because coal, nickel, CPO (crude palm oil) are also entering America. This means that when they enter and are subject to import costs, let's say 25% the price will be increased. This means that the Indonesian government must find new markets," he said. 

It is still unclear whether Indonesia will also be subject to import tariffs by the US. However, he considered that the government needs to make preparations to face Trump's trade war policy. 

"We don't know yet what (Trump's) statement will be tomorrow, whether Indonesia will also be affected by this trade war? We know for ourselves that currently Indonesia is also experiencing economic problems. Not only Indonesia, almost all countries. Moreover, if Indonesia enters the arena of countries with a surplus, the government must also be prepared to respond as soon as possible," he said. 

Ibrahim assessed that Indonesia's trade balance with the US could also be disrupted. Although, it is possible that Indonesia could also see the potential benefits from this US policy. 

"The issue of the trade war on April 2, as an observer, I have been very disappointed that this would happen like this. Moreover, the fiscal deficit is likely to widen," he concluded. 

Tag: Donald Trump Rupiah