Domestic and Global Determinants of the Indonesian Rupiah Exchange Rate Against the US Dollar

Muflihatul Adawiyah; Aminudin Ma’ruf

doi:10.55927/fjmr.v5i8.148

Authors

Muflihatul Adawiyah Universitas Negeri Surabaya
Aminudin Ma’ruf Universitas Negeri Surabaya

DOI:

https://doi.org/10.55927/fjmr.v5i8.148

Keywords:

BI Interest Rates, WTI, VIX, Exchange Rates and Inflation

Abstract

This study aims to analyze the impact of the money supply, Consumer Price Index (CPI) inflation, VIXCLS, Indonesia's Geopolitical Risk (GPR-C), external debt, the BI Interest Rates, and West Texas Intermediate (WTI) oil prices on the IDR/USD exchange rate. The study employs a quantitative approach using the Autoregressive Distributed Lag (ARDL) method, utilizing secondary monthly data for Indonesia covering the period from January 2015 to December 2024, obtained from official publications. The results indicate that the money supply and VIXCLS have a significant positive effect, whereas external debt and WTI oil prices have a significant negative effect on the IDR/USD exchange rate. Conversely, CPI inflation, GPR-C, and the BI Rate do not have a significant impact. The study concludes that the rupiah exchange rate is primarily influenced by domestic monetary factors and global conditions. Future research is advised to incorporate additional variables and extend the observation period.

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