The article examines how the value of the Indonesian currency, the rupiah, affects the likelihood of currency crises. By using a special model and looking at factors like foreign assets and productivity, the researchers found that these factors play a big role in determining the rupiah's value. They also discovered that the rupiah was often overvalued before past financial crises. Out of 17 crises in Indonesia from 1981 to 2012, 10 were preceded by a high misalignment of the rupiah.