The Indonesian rupiah slid to around IDR 18,000 per U.S. dollar on Wednesday, reversing gains from the prior session as a firmer U.S. dollar and renewed safe-haven demand weighed on emerging market currencies after reports that the U.S. launched fresh airstrikes on Iran in response to vessel attacks in the Strait of Hormuz. Domestically, pressure mounted after fresh data showed consumer confidence declined for a second consecutive month in June, falling to its lowest level since last September as households continued to grapple with elevated food prices and rising fuel costs. Concerns over foreign outflows resurfaced after S&P Dow Jones Indices placed Indonesia on watch for a downgrade to frontier market status, echoing MSCI’s move in May. A widening budget deficit in H1 2026, June’s factory contraction, and the largest layoffs since 2025 further hit risk appetite. Still, weakness was capped by a modest rise in June forex reserves after hitting a near two-year low in May.