The Indonesian rupiah weakened for a third straight session on Tuesday, hovering around 16,760 per dollar as sentiment remained cautious after key domestic data. Inflation firmed in December but stayed within Bank Indonesia’s 1.5%–3.5% target, limiting urgency for policy tightening. Headline CPI rose to a 20-month high of 2.92% in the final month of 2025, while core inflation held at a seven-month peak. The central bank previously had signaled scope for further easing in 2026 to support growth after the severe Sumatra flood, following 150bps of cuts between September 2024 and September 2025. On the trade front, November’s surplus missed estimates as exports posted their steepest drop in nearly two years. Caution was also built ahead of the December forex reserves data due later this week, after hitting a three-month high of about USD 150 billion in November. Globally, the dollar index steadied around 98.4 after a volatile session marked by geopolitical jitters and Fed uncertainty.