The Effect of Interest Rates on the Financial Cycle in Indonesia

DOI

10.2991/icmemm-18.2019.2How to use a DOI?

Keywords

Interest Rate, Financial Cycle, Financial Crisis

Abstract

The purpose of this study is to determine the relationship between interest rates and the pressure on the movement of the financial cycle in Indonesia. This study uses secondary data from Bank Indonesia from 1990 to 2017, data is processed using Simultaneous Equation Model. The results of this study found that interest rates have a positive and significant impact on the financial cycle, with a pressure of 0.72 to - 23.92 Amplitude. The renewal of this research shows that short-term interest rates are very effective for economic growth, and long-term interest rates can make pressure on the financial cycle in Indonesia.

Copyright

© 2019, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Edwin Basmar
AU  - Carl Campbell III
AU  - Hasniaty
AU  - Erlin Basmar
PY  - 2019/03
DA  - 2019/03
TI  - The Effect of Interest Rates on the Financial Cycle in Indonesia
BT  - Proceedings of the First International Conference on Materials Engineering and Management - Management Section (ICMEMm 2018)
PB  - Atlantis Press
SP  - 7
EP  - 10
SN  - 2352-5428
UR  - https://doi.org/10.2991/icmemm-18.2019.2
DO  - 10.2991/icmemm-18.2019.2
ID  - Basmar2019/03
ER  -