Analysis of the influence of external factors of the capital market on stock prices and Indonesian economic growth
Keywords:
Capital Market, Stock Price, Economic GrowthAbstract
The Jakarta Composite Stock Price Index (JCI) listed on the Indonesia Stock Exchange (IDX) is interrelated. Economic growth is determined by stock prices influenced by external factors, such as Inflation, Exchange Rates (exchange rates), and Interest Rates. This study aims to analyze the influence of inflation, exchange rate (exchange rate), and interest rate on Indonesian stock prices and look at the influence of inflation, exchange rate (exchange rate), interest rate, and stock price on Indonesia's economic growth. This study uses non-participant observation methods, literature studies, and online data searches. The data analysis techniques used are Descriptive Statistics and Path Analysis The results of this study show that 1) Inflation variables have a negative and insignificant influence on stock prices in Indonesia. Exchange rate variables have a positive and significant influence on stock prices in Indonesia. Interest rate variables have a negative and significant influence on stock prices in Indonesia; 2) Inflation variables and price variables have a negative and insignificant influence on economic growth in Indonesia. Exchange rate and stock price variables have a positive and significant influence on economic growth in Indonesia; 3) Inflation, exchange rates, and interest rates indirectly affect Indonesia's economic growth. The conclusion of this study is that external factors affect stock prices and Indonesia's economic growth.
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