DETERMINANTS OF SHARIA FINTECH GROWTH IN INDONESIA: AN INTEGRATIVE ANALYSIS OF MACROECONOMIC INDICATORS AND MONETARY POLICY

Purpose: Despite variations in economic indicators such as inflation, central bank interest rates, monetary supply, currency valuations, and Islamic financial products, the Jakarta Islamic Index maintains steady stock trading performance. The study examines how various economic factors influenced the Jakarta Islamic Index (JII) between 2010 and 2023. In particular, it explores how the index's behavior is shaped by inflationary pressures, Bank Indonesia's benchmark rate, money circulation, foreign currency exchange rates, and Islamic-compliant certificates issued by Bank Indonesia.Design/Method/Approach: The study utilizes quantitative methods, analyzing data collected over time from credible institutions such as Bank Indonesia, the Financial Services Authority, the Central Statistics Agency, and other reputable sources. Various analytical approaches are employed, including classical assumption testing, multiple linear regression, individual and collective significance evaluations, and determination coefficient analysis. This research employs various analytical techniques to examine how multiple economic variables (including inflation rates, the Bank Indonesia interest rate, money supply levels, currency exchange rates, and Bank Indonesia Sharia Certificates) potentially influence or correlate with the performance of the Jakarta Islamic Index.Findings:The study's results indicate that among the economic factors analyzed, such as Inflation, BI Rate, Money Supply, and Bank Indonesia Sharia Certificates, most did not show significant individual effects on the Jakarta Islamic Index. The exchange rate, however, emerged as the only factor with a notable individual impact. Collectively, when all these economic variables were considered together, they were found to have a combined influence on the Jakarta Islamic Index.Originality/Values: This study's findings offer valuable information for both investors and policymakers, shedding light on the intricate workings of the Islamic capital market and pinpointing crucial economic factors that shape its performance.ABSTRACTPurpose: Despite variations in economic indicators such as inflation, central bank interest rates, monetary supply, currency valuations, and Islamic financial products, the Jakarta Islamic Index maintains steady stock trading performance. The study examines how various economic factors influenced the Jakarta Islamic Index (JII) between 2010 and 2023. In particular, it explores how the index's behavior is shaped by inflationary pressures, Bank Indonesia's benchmark rate, money circulation, foreign currency exchange rates, and Islamic-compliant certificates issued by Bank Indonesia.Design/Method/Approach: The study utilizes quantitative methods, analyzing data collected over time from credible institutions such as Bank Indonesia, the Financial Services Authority, the Central Statistics Agency, and other reputable sources. Various analytical approaches are employed, including classical assumption testing, multiple linear regression, individual and collective significance evaluations, and determination coefficient analysis. This research employs various analytical techniques to examine how multiple economic variables (including inflation rates, the Bank Indonesia interest rate, money supply levels, currency exchange rates, and Bank Indonesia Sharia Certificates) potentially influence or correlate with the performance of the Jakarta Islamic Index.Findings:The study's results indicate that among the economic factors analyzed, such as Inflation, BI Rate, Money Supply, and Bank Indonesia Sharia Certificates, most did not show significant individual effects on the Jakarta Islamic Index. The exchange rate, however, emerged as the only factor with a notable individual impact. Collectively, when all these economic variables were considered together, they were found to have a combined influence on the Jakarta Islamic Index.Originality/Values: This study's findings offer valuable information for both investors and policymakers, shedding light on the intricate workings of the Islamic capital market and pinpointing crucial economic factors that shape its performance.

This research aims to empirically test the direct and indirect influence of macroeconomics represented by inflation indicators, gross domestic product, and Bank Indonesia (BI) interest rates as independent variables on stock prices as the dependent variable and financial performance (ROA) as the intervening variable. The population of this research is pharmaceutical companies included in the IDX-IC F211 classification; the sample of this research is companies listed from 2020 to 2021. This research uses path analysis and panel regression on reviews as a test tool to detect the direct and indirect influence of relationships between the independent and dependent variables. This research shows that inflation and ROA directly affect stock prices. In contrast, BI interest rates and GDP do not directly affect stock prices. Inflation and GDP affect ROA, while BI interest rates do not affect ROA. ROA can mediate the effect of inflation and BI interest rates on stock prices but cannot mediate the effect of GDP on stock prices. This research implies that companies can use the findings of this research to identify how specific macroeconomic factors can affect financial performance. This can assist in planning risk management strategies to mitigate the negative impact of macroeconomic fluctuations.

This study aims to analyze the stability of the Vector Autoregression (VAR) model using data on inflation and Bank Indonesia (BI) interest rates. The VAR model is a widely used econometric method for analyzing dynamic relationships between macroeconomic variables. In this research, monthly data on inflation and BI interest rates from August 2018 to August 2024 were utilized. The stability of the model was tested after performing a unit root test to assess data stationarity, followed by a stability test on the VAR model. The stability analysis of the VAR model is important to ensure that the resulting model can provide accurate predictions and is not divergent. If the model is not divergent, the predicted values remain controlled or bounded, indicating that the model is suitable for long-term use. The results show that in the unit root test, inflation data became stationary at the 2nd difference, while the BI interest rate data became stationary at the 1st difference. The stationary data were then used to build the VAR model, which was subsequently tested for stability. The stability test results, as seen from the AR Roots Table or AR Roots Graph, indicate that the VAR model is stable. Thus, the VAR model developed using these two variables satisfies the stability criteria, indicating that it can serve as a dependable tool for forecasting the dynamics between inflation and BI interest rates moving forward.

This study aims to analyze the effect of macroeconomic factors on Jakarta Islamic Index. The macroeconomic factors are Word Oil Prices, Bank Indonesia Interest Rate, Inflation and Exchange Rate. The method used in this study is a quantitative approach, where data obtained from the Yahoo Finance, Investing Stocks and Forex, Statistic Indonesia and Bank Indonesia. The data used are time series from 30 June 2014 to 31 May 2018, which is 48 observation period. The statistical tool used is multiple linear regression using SPSS.20. The result shows that Word Oil Prices, Bank Indonesia Interest Rate and Exchange Rate have significant effect and negative relation on Jakarta Islamic Index, while Inflation has no significant effect on Jakarta Islamic Index. Simultaneously, these macroeconomic factors also have a significant effect on Jakarta Islamic Index.

This study aims to analyze the effect of per capita income, Bank Indonesia (BI) interest rates, and the consumer price index on the demand for electronic money in Indonesia during the period 2009-2022. In an increasingly developing digital economy era, financial technology (FinTech) innovations play a crucial role in facilitating financial transactions and fostering a cashless society. This study highlights macroeconomic variables that are considered to have a significant impact on the adoption of electronic money in Indonesia.The data used in this study consists of annual data obtained from official sources such as Bank Indonesia and the Central Bureau of Statistics. The analysis method used is multiple linear regression to measure the effect of each independent variable on the dependent variable. Before performing the regression analysis, classical assumption tests were conducted to ensure that the data met the classical linear regression requirements, including tests for normality, multicollinearity, autocorrelation, and heteroscedasticity.The results of the study indicate that per capita income has a positive and significant effect on the demand for electronic money. This finding suggests that an increase in per capita income encourages greater use of electronic money as a means of payment. BI interest rates were also found to have a significant but negative effect on the demand for electronic money, indicating that higher interest rates tend to reduce the use of electronic money. Conversely, the consumer price index was found to have a positive but not significant effect on the demand for electronic money, meaning that fluctuations in consumer prices do not have a substantial impact on the use of electronic money.

This study aims to examine the impact of Bank Indonesia's interest rate policy on customer savings decisions regarding choosing savings products in conventional banks, as well as its effect on the liquidity of these banks. The research utilizes a literature review method with a qualitative descriptive approach. The results and discussion indicate that the offered interest rates by conventional banks significantly influence customer behavior in selecting savings products. Changes in interest rates can affect customers' inclination to save in banks and consequently impact the liquidity of conventional banks. Other factors that influence customer decisions include product promotions, service quality, and customer preferences. While changes in Bank Indonesia's interest rate policy can affect customer loyalty to banks, customer preferences in choosing savings products are also influenced by other non-interest rate-related factors. This study provides an in-depth understanding of the impact of interest rate changes on the liquidity of conventional banks, offering valuable insights for Bank Indonesia and conventional banks in formulating effective policies to maintain financial sector stability and foster sustainable economic growth.

The aim of this research is to determine the influence of the money supply and Bank Indonesia interest rates on the consumer price index in Indonesia for the period 2018 - 2022. The discussion of this research is related to the money supply, Bank Indonesia interest rates, and the consumer price index (CPI). In this regard, the approach taken is theories related to that field. This research was conducted in Indonesia. This type of research is quantitative research. The data used in this research is time series secondary data in the form of publications on the money supply, Bank Indonesia interest rates, and consumer price index from January 2018 to December 2022 obtained from the Central Statistics Agency (BPS) and Bank Indonesia. The research method used in this research is the explanatory method. The data analysis techniques in this research are descriptive analysis and multiple linear regression analysis. The research results show that both partially and simultaneously, there is an influence of the money supply and Bank Indonesia interest rates on the consumer price index.

Foreign investment is an activity of investing capital from one country to another. In essence, investment is an initial step in economic development activities. Foreign investment can be influenced by several factors, such as inflation, Bank Indonesia interest rates, labor, gross domestic product, and exchange rates. From the theory and actual conditions, the researchers found a gap. From this gap, the problem in this study was how inflation, Bank Indonesia interest rates, labor, Gross Domestic Product (GDP), exchange rates, and export value affected foreign investment in Indonesia in the short and long run. The aim of this study was to determine the effect of inflation, Bank Indonesia interest rates, labor, Gross Domestic Product (GDP), exchange rates, and export value on foreign investment in Indonesia in the short run and long run. The analytical method used in this research was Autoregressive Distributed Lag (ARDL). Based on the findings, this study concludes that in the short run, the variable of inflation, Bank Indonesia interest rates, Gross Domestic Product (GDP), and exports value have significant and positive effects on foreign investment in Indonesia. Meanwhile, labor and exchange rate variables have significant and negative effects on foreign investment in Indonesia. In the long run, inflation and export value variables have significant and positive effects on foreign investment in Indonesia. In addition, interest rates of Indonesia's Bank and exchange rates have significant and negative effects on foreign investment in Indonesia. However, the variables of labor and Gross Domestic Product (GDP) have no effect on foreign investment in Indonesia.

The aim of this research is to determine the influence of the money supply and Bank Indonesia interest rates on the consumer price index in Indonesia for the period 2018 - 2022. The discussion of this research is related to the money supply, Bank Indonesia interest rates, and the consumer price index (CPI). In this regard, the approach taken is theories related to that field. This research was conducted in Indonesia. This type of research is quantitative research. The data used in this research is time series secondary data in the form of publications on the money supply, Bank Indonesia interest rates, and consumer price index from January 2018 to December 2022 obtained from the Central Statistics Agency (BPS) and Bank Indonesia. The research method used in this research is the explanatory method. The data analysis techniques in this research are descriptive analysis and multiple linear regression analysis. The research results show that both partially and simultaneously, there is an influence of the money supply and Bank Indonesia interest rates on the consumer price index.

The determination of interest rates by Bank Indonesia plays an important role in supporting national economic stability and growth. Although previous studies have highlighted the relationship between interest rates and economic growth and market performance, studies on macroeconomic determinants of interest rate determination are still limited. This study aims to analyze the effect of inflation and exchange rates on Bank Indonesia's interest rates in the period 2004 to 2023, covering both crisis and non-crisis periods. The method used is a quantitative approach with multiple linear regression analysis, as well as classical assumption tests to ensure the validity of the model. The results of the study show that inflation has a positive and significant effect on interest rates, while the exchange rate does not show a significant effect. This finding indicates that inflation is the main factor that Bank Indonesia considers in determining interest rate policy. The policy implications of this study emphasize the importance of controlling inflation in order to maintain the effectiveness of monetary policy and long-term economic stability.

This research aims to determine the influence of the rupiah exchange rate on the use of Kina in Mosso Village, Muara Tami, Papua. Quantitative methods were used in this research to analyze secondary data collected from the websites of Bank Indonesia and the Indonesian Central Bureau of Statistics. The number of quarters, which collects all information during the study period, was used for sampling. This research uses two independent variables: inflation, Bank Indonesia interest rates (SBI) and money supply (JUB). The dependent variable is the exchange rate. Multiple linear regression analysis, T test, and F test were used to analyze the data. The results of the T hypothesis test show that inflation has a significant influence on the exchange rate partially during the period studied, with a significance value of 0.001. The interest rate does not have a significant influence on the exchange rate partially during the period studied, with a significance value of 0.462. The money supply also does not have a significant influence on the exchange rate partially, with a significance value of 0.17. The results of the F hypothesis test with a significance value of 0.000 show that inflation, interest rates and money supply simultaneously have a significant influence on the exchange rate in the 2018–2022 period.

Indonesia's economic stability should be achieved by implementing monetary and fiscal policies, for instance, setting the interest rate by Bank Indonesia (BI) as policy rate of central bank, which should be followed by other banking institutions. Unfortunately, this interest rate regulation by BI had not been able to achieve the goal of restoring economic stability since it always had long time lag. This happened because the policy of increasing interest rates had not been followed up spontaneously by other banking institutions. In fact, time lag might cause disadvantages such as long-lasting high inflation, increased poverty, and severe economy vulnerability. This research was conducted to analyze the time lag of the transmission of Bank Indonesia's interest rate monetary policy and the response of banking institutions in Indonesia. The method used in this study was survival analysis. The results indicated that the time lag of monetary policy transmission using the interest rate in Indonesia needed to be improved to double adjustment speed to reach the optimal point. The response of banking institutions could be improved because there was still asymmetry response in all aspects including types of interest rates, allocations, and change direction. Meanwhile, from the aspect of ownership, both state-owned and private-owned banks had shown in line response of time lag performance.

Changes in the benchmark interest rate by monetary authorities are often an important catalyst for financial market dynamics, particularly in influencing the risk perception of foreign investors in developing countries such as Indonesia. In this context, this study aims to analyze the influence of Bank Indonesia's interest rate policy on foreign investors' perception of investment risks, with an event study approach. This study uses secondary data that includes daily stock prices, exchange rates, and foreign capital flows during the period 2020–2023. The research sample consisted of companies listed on the Indonesia Stock Exchange and actively traded during the observation period. Data analysis techniques include calculation of abnormal returns (AR) and cumulative abnormal returns (CAR), as well as statistical testing with t-tests and Wilcoxon Signed-Rank. The results show that the announcement of interest rate cuts consistently results in abnormal positive returns and increased foreign capital flows, while interest rate hikes lead to abnormal negative returns and capital withdrawals by foreign investors. A significant market response mainly occurred on the 1st to 3rd day after the announcement, which shows the market efficiency of the semi-strong form. These findings confirm that interest rate policy has a high information value and directly influences the risk perception of foreign investors. The practical implications of this study underscore the importance of transparency and consistency of monetary policy communication to maintain market stability and investment attractiveness in Indonesia.

Abstract. Inflation is an economic phenomenon characterized by an unrelenting surge in the prices of commodities and services over a defined period. When this price surge occurs repeatedly and is supported by high levels, the situation is categorized as inflation. One of the consequences of inflation is a decrease in people's purchasing power. During the 2022–2024 period, Indonesia experienced considerable price instability. This research aims to empirically investigate how BI's interest rates and the total money in circulation affect the inflation rate. The testing was conducted using a statistical assumption approach and hypothesis testing. The research findings indicate that Bank Indonesia's interest rate policy has a substantial impact on controlling the inflation rate in Indonesia. Keywords: Inflation Rate, BI Interest Rate, Money Supply

The purpose of this study is to determine how the influence of monetary policy instruments on economic stability in Indonesia. Monetary policy instruments as exogenous variables are policies in the money supply M2 (X1) and Bank Indonesia interest rates (X2) while indicators of economic stability as endogenous variables can be seen from price stability (Y1) and exchange rate stability (Y2). This research is descriptive and associative research. The data used in this study is monthly secondary data from January 2001 to December 2020 which was collected through documentation from the relevant agencies. The data analysis used in this research is descriptive analysis and inductive analysis. In the inductive analysis there are several tests, namely (1) Stationarity Test; (2) Cointegration Test; (3) Multiple Linear Regression Test and Error Correction Model (ECM); (4) Classical Assumption Test; (5) T test and F test. The results of this study is: (1) in the long term and short term the money supply M2 has a negative effect on price stability in Indonesia; (2) Bank Indonesia interest rates in the long term and short term have a positive influence on price stability in Indonesia; (3) in the long term and short term The money supply M2 has a positive influence on the stability of the exchange rate in Indonesia; (4) Bank Indonesia interest rates in the long term and short term have a positive influence on exchange rate stability in Indonesia.