The Indonesian rupiah slipped toward IDR 16,800 per dollar on Thursday after briefly hitting 16,680 in the prior session. Expectations of further policy easing rattled sentiment as Bank Indonesia emphasized its focus on supporting growth, with the board noting the economy remains below potential. Concerns over institutional independence also resurfaced after parliament approved President Prabowo’s nephew as central bank deputy governor. Still, the rupiah was up about 0.3% so far this week, keeping gains from the prior session, after the central bank’s fourth straight pause in monetary policy. Meanwhile, loan growth rose to a 10-month high in December, suggesting the total 150bp of cuts since September 2024 are gaining traction. Globally, the dollar index stabilized after hitting a four-year low earlier in the week, supported by Treasury Secretary Scott Bessent’s reaffirmation of a “strong dollar” policy. Meantime, the Fed left rates unchanged, as expected, following three cuts in 2025.