Abstract
This study aims to determine the effect of inflation, interest rates, and world oil prices on fluctuations in gold prices in Indonesia with the US Dollar exchange rate as an intermediary variable. This research is a type of explanatory research with a quantitative approach. The data used are monthly time series data for 2014 - 2019 with a sample of 72 samples. Hypothesis testing in this study uses path analysis, is a development technique of multiple linear regression. This technique is used to test the amount of contribution shown by the path coefficient on each path diagram of the causal relationship between cariables X1, X2, and X3 on and its impact on Z. The results of this study indicate that the effect of inflation, interest rates and worl oil prices on exchange rates individually has very little effect. The effect of inflation, interest rates, world oil prices and the exchange rate on gold prices individually shows a negative value for inflation and interest rates means that the effect is small, while for the world oil price and the dollar exchange rates shows a positive value which means that it has a large effect on the price of gold. The effect of inflation, interest rates and world oil prices on gold prices through the exchange rate, all variable show a negative value, this indicates that the effect is very small.
Highlights
Investment is an activity related to investing in a variety of alternative assets, both classified as real assets, such as land, gold, property, and in the form of financial assets, such as stocks, bonds, or mutual funds
Consistency of purchasing power, when the price of gold falls means that it will not experience a decrease in wealth because gold has zero inflation. c). It does not depend on government decisions, meaning that when holding gold there is no need to worry about government decisions about interest rates and others. d)
It was found that the effect of inflation, either directly or indirectly, resulted in a minus value, this means that there was no influence of inflation on the gold price through the dollar exchange rate, this was caused by inflation that occurred during the study period, which was included in the category. mild inflation that is below 10%
Summary
Investment is an activity related to investing in a variety of alternative assets, both classified as real assets, such as land, gold, property, and in the form of financial assets, such as stocks, bonds, or mutual funds. Gold investment is in great demand by many people for reasons of security and the benefits promised. They choose to invest in gold to get benefits in the long term, because the value-added of gold is not too big in the short term compared to investing in the stock market. There is no risk in gold when holding gold means holding tangible assets that do not depend on others. It does not depend on government decisions, meaning that when holding gold there is no need to worry about government decisions about interest rates and others. Assets that are outside the banking system, meaning that holding gold is free from the vortex of a banking crisis that can arise anytime and anywhere.
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