THE EFFECT OF ECONOMIC AND NON-ECONOMIC FACTORS ON THE EXCHANGE RATE OF THE RUPIAH WITH THE US DOLLAR

Amount: THE EFFECT OF ECONOMIC AND NON-ECONOMIC FACTORS ON THE EXCHANGE RATE OF THE RUPIAH WITH THE US DOLLAR

Authors: DHYAH HARJANTI

Item Type: Thesis

Memberships: Master of Management Study Program, Faculty of Economics and Business Universitas Airlangga Surabaya, Indonesia

Publisher: Airlangga University

Abstract

The monetary crisis that occurred in Indonesia along with other regions in Southeast Asia, East Asia, Russia and Latin America was a reflection of a combination of the internal economic problems of countries experiencing crisis and external turmoil of a global nature. This crisis is different from the crises that have occurred before in addition to its deep intensity, and because it occurred at a time when the global financial system was already so complex, both in terms of structure and problems. One of the main indicators of a crisis is exchange rate fluctuations. Various efforts have been made by the Indonesian monetary authorities to maintain the stability of the rupiah exchange rate against foreign currencies, especially the US dollar, but the value of the rupiah remains out of control. This study examines one approach to determining the exchange rate, namely the portfolio balance approach, by making modifications in the form of adding an unexpected event variable as a dummy variable in the model to find out how the influence of non-economic variables on value fluctuations Exchange The hypothesis tested in this study is that domestic money supply, domestic debt, foreign debt, international interest rates and unexpected event variables have a significant effect on the US dollar, either partially or jointly. same. From the results of data processing using the regression method, it can be concluded that the domestic money supply, domestic debt, foreign debt, international interest rate and unexpected event variables have a significant effect on the US dollar, either partially or partially. together. This means that fluctuations in the rupiah exchange rate are not only influenced by economic factors, but are also influenced by non-economic factors included in the unexpected event variable.

Keywords: fluctuation, rupiah value, economic variables, money supply, domestic obligations, foreign obligations, international interest rates, non-economic variables, unexpected events, political and social instability

sources: http://repository.unair.ac.id/35521/