TUGAS SOFTSKILL 2
BAHASA INGGRIS 2#
Nama Kelompok :
AIRIN AKTE SAVIRA (20210444)
APRIYANI PUSPASARI (20210972)
MERRY PANGARIBUAN (24210366)
3EB09
EFFECT OF
INFLATION, INTEREST RATE, RATE, AND GROWTH OF GDP COMPOSITE STOCK PRICE INDEX
Abstract:
The Effect of
Inflation, interest rate, exchange rate, and GDP growth Toward Indonesia
Composite Index. This research aims to investigate empirically the effect of
selected macroeconomic variables, i.e., inflation rate, Bank Indonesia Certificate
rate, the exchange rate on IDR, and GDP growth on Indonesia Composite Index at
The Indonesia Stock Exchanges (IDX). This paper examines the direct effect of
selected macroeconomic variabel on Indonesia Composite Index. The paper employs
a regression model analysis. The result indicates that only the exchange rate on
IDR significantly effects to Indonesia Composite Index. The inflation rate,
Bank Certificate rate, and GDP growth do not effect to Indonesia Composite
Index. This research only covers four selected macroeconomic variables.
Therefore, further research should examine other potential macroeconomic
variables.
Preliminary
Macroeconomic
environment is the environment that affect day-to-day company operations. The
ability of investors to understand and predict macroeconomic conditions in the
future will very useful in making profitable investment decisions.
Therefore, an
investor should consider several indicators macroeconomic may assist investors
in making decisions investment. Macroeconomic indicators often associated with
capital markets, fluctuations in interest rates, inflation, exchange rate dollars,
and GDP growth. In theory, the interest rate and the price stocks have a
negative correlation (Tandelilin, 2010). Interest rate too high will affect the
present value (present value) of cash flow company, so the investment opportunities
that exist will not interesting again. High interest rates also will increase
the capital cost will be borne by the company and will also cause investors
signaled the return of an investment will increased. Similarly, inflation, high
inflation is usually associated with economic conditions that are too hot
(Overheated). That
is, the economic conditions experienced demand for a product that exceeds the
capacity of its product offerings, so prices tend to rise. Inflation is too high
also will cause a decrease in the purchasing power of money (purchasing power
of money). In addition, high inflation could also reduce the level of real
income derived from the investment of investors. Exchange rate is the
macroeconomic variables that influence price volatility stock.
Depreciation of
the domestic currency will increase the volume of exports. When the
international market demand is sufficiently elastic it will improve the cash
flow of domestic firms, which then increase the stock price, which is reflected
in the index. Conversely, if the issuer to buy domestic product, and have debt
in the form of dollar stock price will go down. Depreciation of the exchange
rate will increase reflected in the stock price index in the economy is
experiencing inflation. Gross Domestic Product (GDP), including factors
affecting the stock price changes. GDP estimates will determine the development
of the economy. GDP comes from the amount of consumer goods including capital
goods which are not. With the increasing number of consumer goods led the
economy grow, and increase the scale of the sales turnover of the company,
because the consumptive society. With the increase in the sales turnover of the
company increased profits. Increase in profit caused the company's stock price also
increased, which affects the JCI movement. In recent years, the index Indonesia
Stock Exchange stock market showed an increase in the quite dramatically, from
the level of 416.32 at the end of 2000 to 2534.36 by the end of 2009, an
increase of 508.75 percent. Although a high index growth was hampered on In
2008 due to the global crisis that affects the performance of stock markets
around the world including the Indonesia Stock Exchange index decreased by
50.64 percent from the previous year, but rapid regrowth occurred in 2009 in the
amount of 86.98 percent from 2008. Indonesia's GDP growth from year 2000 to
2009 showed uptrend, although GDP growth had declined in 2001. The existence of
the rising trend of GDP growth is in line with the rising trend of JCI. In
theory can be explained that the increase in GDP may increase consumer
purchasing the product-produkperusahaan thereby increasing profitability. With
the increased profitability of the company can boost investor confidence in
order to increase the stock price stock. The "portfolio balance"
assumes the stock
as part of the wealth so as to affect behavior of the exchange rate through the
legal demand for money in accordance with the model monetarists of exchange
rate determination.
Method
Types
of research data into quantitative data including the period
observations from
2000 through 2009. Sources of data used in this study are secondary data data
supporting the study variables. Data from the independent variables in this
study, namely: the rate of inflation, SBI interest rate, exchange rate, and GDP
growth. Data from the dependent variable is the index. Research object, the
Indonesia Stock Exchange. Year period of study 2000 to 2009. Data obtained from
the information and reports from the Indonesia Stock Exchange, Bank Indonesia
and the Central Bureau of Statistics. The study included one dependent variable
index which is a change or sham price movement of all listed companies on the
Stock Exchange as measured at the end of each month.
While
the independent variable is the rate of inflation, SBI interest rate, exchange
rate against the U.S. dollar and GDP growth. Measurement of inflation rate
originated from The pace of Inflation who recorded and published by BPS each
the end of month, interest rate SBI calculated of the average SBI three monthly,
while it exchange rate of Rupiah against American Dollar which used is the
middle rate rupiah, whereas the GDP growth calculated from the data of GDP
growth used 3 monthly.
Data analysis
methods are used by multiple regression analysis. Hypothesis testing using
t-test, while testing a regression model using the F test The significance
level
used was 5%.
Results
and Discussion
Data research data
has been collected as much as 120 per month for 10
years from 2000
until 2009. The inflation rate has a minimum value of -0.36%, the maximum value
of 7.93%, the mean of 0.68% and a standard deviation of 0.87%. Interest rates
have a minimum value of 6.50%, the maximum value of 17.67%, 10.63% and a mean
standard deviation of 3.28%. The rupiah has a minimum value of Rp7.425, 00, a
maximum of Rp12.151, 00, a mean of Rp9.378, 62 and a standard deviation of
Rp846, 58. GDP growth has a minimum value of -2.79%, a maximum value of 17.54%,
4.22%, and the mean deviation standard of 2.15%. JCI has a minimum value of
358.23, the maximum value of 2745.3, mean of 1160.00 and
standard deviation
of 739.11.
To
see the influence the whole variables freely against variable bound
simultaneously obtained value of F amounting to 5.231 with p = 0.001. By
because level of significance is smaller than 0.05 (0.001 <0.05), then the can
be be concluded that the there are influence rate of inflation, interest rate
SBI, exchange rate rupiah,
growth GDP
simultaneously towards JCI in BEI. By because basis simultaneous
has a influence a significant,
then the necessary tested respective influence-each independent variables basis
partial. Testing is done with test t.
Inflation
data based on statistics descriptive, the average rate of inflation during the study
period of 0.68. The market is still could receive if the inflation rate under 10
percent. However, when inflation penetrate 10 percent, the stock market will
Disturbed.
Conclusion
This research find
that the level of inflation, interest rate SBI and growth GDP
does not have
influence a significant against IHSG, whereas exchange rate of rupiah
influential negative
and significant against the JCI. Research this proves that the variable exchange
rate of rupiah affect negatively significant against the IHSG who does it mean increasingly
stronger exchange rate of rupiah against U.S. $
(rupiah has
appreciated) then the will increase the stock prices, and vice versa.
This case gives
implication theoretical that the empirically these findings increasingly
strengthen the
theory the strengthening exchange rate of eye money of a country give signal positive
for the country economy. So that is practically the findings this
implies that the
the government must always take the step-strategic steps for strengthen the
level of exchange rate of eye his money.
