The Effect of World Gold Price, World Oil Price, USD/IDR Exchange Rate, and Inflation on the Joint Stock Price Index (JCI) On the Indonesia Stock Exchange (IDX)

Abstract

This study's purpose is to analyze the impact of world oil prices, world gold prices, inflation, and USD/IDR exchange rates on the Composite Stock Price Index (IHSG) on the Indonesia Stock Exchange (IDX). Secondary data was obtained from the London Financial Market Association (LBMA), Bank Indonesia, and investing.com. The variables used in this study are world oil prices, world gold prices, USD/IDR exchange rates, and inflation as independent variables—also, the Composite Stock Price Index (CSPI) as the dependent variable. This study was conducted using secondary data per month in 2015-2019, non-participant observation with a saturated sampling method of 60 months. The analysis used in this research is Least Square and Autoregressive Moving Average (LS&ARMA) regression analysis. Simultaneous research results show that world oil prices, gold prices, USD/IDR exchange rates, and inflation significantly affect the Composite Stock Price Index (JCI). The study results partially show that world gold prices and inflation have an important adverse effect on the JCI, while world oil prices significantly positively impact the JCI. It is different from the USD/IDR exchange rate, which does not influence the JCI. The practical conclusion of this research is to afford information to investors that world gold prices, world oil prices, and inflation should be considered in making investment decisions in the capital market.