International credit rating agency Fitch Ratings said that the recent depreciation of the rupiah may add pressure to developers in Indonesia which have a large portion of loans denominated in US dollar and already face slowing property demand.

The Rupiah is the second worst performing currency in Asia in the last three months and broke through Rp14,200 per US dollar, a level not seen since December 2015.

In the short term, this will affect Indonesian homebuilders as their interest and capital payments will increase in local-currency terms. Each of the Fitch-rated developers has 50% or more of their borrowings in US dollars as dollar-denominated bonds are traditionally more attractive because they have a broader investor base and are cheaper than bank loans or domestic bonds.

Fitch also believes that the currency depreciation may also lead buyers to hold off big-ticket purchases; on top uncertainties around the presidential election in 2019. Consequently this may result in lower-than-expected pre-sales and associated cash flows.