THE INFLUENCE OF EXCHANGE RATES AND INFLATION ON EXPORTS IN INDONESIA

Media Putri Baroto; Farisma Wahyu Handayani; Maria Okta Desta Selly Arya Putri; Fauziah Hevy Indarvirastri; Aurora Valentina Irianto; Josephine Wuri

doi:10.24071/icebmr.v4i1.60

Authors

Media Putri Baroto Sanata Dharma University Author
Farisma Wahyu Handayani Sanata Dharma University Author
Maria Okta Desta Selly Arya Putri Sanata Dharma University Author
Fauziah Hevy Indarvirastri Sanata Dharma University Author
Aurora Valentina Irianto Sanata Dharma University Author
Josephine Wuri Sanata Dharma University Author

DOI:

https://doi.org/10.24071/icebmr.v4i1.60

Keywords:

Exchange Rate, Inflation, Indonesian Exports, Time Series

Abstract

Exports play a crucial role in a country's economic growth. Exports are influenced by various macroeconomic factors, primarily exchange rates and inflation. Exchange rate depreciation can increase export competitiveness, and conversely, exchange rate appreciation can reduce competitiveness. Inflation affects export performance, where high inflation increases production costs and reduces the competitiveness of export goods. This research is crucial for understanding the impact of exchange rates and inflation on Indonesian exports. Data in the form of a time series period 1993-2023 obtained from World Development Indicators (WDI). The variables used include exchange rates, inflation, and exports of Goods and Services. Using a quantitative approach with econometric analysis, specifically multiple linear regression, to determine the cause-and-effect relationship between variables. The results of the study indicate that simultaneously, exchange rates and inflation have a significant effect on exports. Partially, the results of the study show that inflation has a negative and significant impact on Indonesia's exports. In contrast, the exchange rate does not exhibit a significant influence on exports.

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