Business, Management and Accounting
4 years ago

Interest Rates and Inflation Drive Indonesia Stock Market Swings

Jurnal Mantik
Analysis of the Effect of the BI Rate, Inflation and Exchange Rates on the Composite Stock Price Index (Study on the Indonesia Stock Exchange (IDX) for the 2014-2018 period)
Mariska Sisilia, Lidia Rori Hulu, Sani Sutri Cuary, Steven Ginting

Paper Summary

The researchers analyzed how interest rates, inflation, and exchange rates affect the stock market in Indonesia from 2014 to 2018. They found that all three factors together have a significant impact on the stock prices. Specifically, when the interest rate goes up, the stock prices tend to increase as well. However, these factors only explain 19% of the changes in stock prices, with the remaining 81% influenced by other factors.

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