Indonesia's rupiah shattered all but the most pessimistic of expectations yesterday, crashing to 16,500 to the US unit as debt woes ballooned without any clear solution in sight. Jakarta's central bank dipped into foreign currency reserves to haul the rupiah back to 12,000 to the US dollar by the close of trading. President Suharto ruled out any moves by his government to bail out a private sector now hamstrung with debt-servicing requirements estimated at US$4 billion a month - a key factor in the plunge. Analysts said that without any solid moves to tackle debt, government intervention represented 'blood in the water' for speculators. US funds and agent banks, including George Soros' Quantum Fund, were rumoured to have mounted another morning attack after shorting the rupiah on Wednesday and other European and Asian funds piled in. Renewed attacks are expected today. At 16,500, the rupiah is by far the worst performing currency in the world, having shrunk to almost an eighth of its value in June, when it traded at 2,450 to the US dollar. Government officials are locked in crisis talks and are consulting with the International Monetary Fund. An announcement is expected within days but analysts believe a clear settlement remains far off despite individual roll-over talks under way in Singapore and Jakarta. Estimates suggest Indonesia's firms owe $80 billion, of which as much as $65 billion could be short term. The government holds IMF-supported reserves of $21 billion and any wholesale guaranteeing of commitments is seen as unlikely. It holds its own sovereign debt of about $58 billion. President Suharto's insistence that the government would not bail out the private sector came in talks with a special envoy of Japanese Prime Minister Ryutaro Hashimoto, a government official said. State Secretary Murdiono said: 'The major concern is that most Indonesian private debt is short-term [while the funds] are used for long-term projects. When the debt matures, they rush to secure dollars and this helps to weaken the rupiah. 'The president's concern is how to arrange debt repayment in such a way that it will not burden borrowers too much and the lenders won't lose,' Mr Murdiono said. As debt continues to submerge the rupiah, it is putting pressure on President Suharto's revised budget to be formally presented today. The new budget is based around an exchange rate of 5,000 rupiah to the dollar - 1,000 more than the first document which was heavily criticised internationally. It estimates inflation at 20 per cent - a figure in doubt should the rupiah continue to slide. The Jakarta Composite Index led a decline in regional stock markets yesterday, falling 4.82 per cent.