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The rupiah exchange rate against the United States dollar (USD) has continued to weaken in recent weeks. As of this morning, the rupiah exchange rate reached Rp 16,038 per USD.
Many believe that the strengthening of the USD against the rupiah has wide-ranging effects on the national economy. On the one hand, exporters benefit from increased income and improved competitiveness of export-oriented products.
However, on the other hand, manufacturing industries that rely on imported raw materials face rising production costs, leading to higher product prices.
This situation contributes to rising inflation, as the cost of goods increases and people’s purchasing power declines. It presents a dilemma for Bank Indonesia (BI) in setting the benchmark interest rate.
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Raising the BI rate would lead to higher lending and credit interest rates, potentially making the capital market more volatile.
It also has the potential to reduce consumer spending, particularly on automotive products, where over 80% of purchases in Indonesia are made on credit.
If the BI rate is not raised, inflation and the weakening of the rupiah may continue, potentially stagnating economic growth.
Some attribute the weakening of the rupiah to declining export activity, particularly in mining, plantation commodities, and semi-finished goods. Contributing factors include the war between Russia and Ukraine.
The political tensions in the Middle East also have considerable impacts:reduced the demand for Indonesian exports and driven down prices.
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Given these geopolitical issues, it’s uncertain when the rupiah will stabilize. Optimists believe that resolving political tensions and revitalizing global economies could help.
For businesses reliant on partnerships for logistics and transportation, current conditions are challenging.
Choosing the right partner to ensure efficient and effective operations is crucial. Opting for a comprehensive, one-stop logistics and transportation service is a smart choice.
See also: 5 Telltale Signs of a Good Logistics Company
One exemplary service provider is SELOG, a business line of PT Serasi Autoraya or SERA, and part of Astra International Tbk with extensive industry experience.
SELOG offers end-to-end logistics services, including Contract Logistics, Shipping Services, Shipping Agency, Freight Forwarding, Warehouse and Yard Management, and Courier Services.
Supported by advanced digital technology, SELOG ensures efficient and effective business operations. Through Astra Fleet Management Solution (FMS), SELOG provides comprehensive vehicle and transportation management solutions based on information technology.