Proceedings of the Ninth Padang International Conference On Economics Education, Economics, Business and Management, Accounting and Entrepreneurship (PICEEBA 2022)

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Exchange Rate Pass Through During the Covid-19 Pandemic in Indonesia

Authors
Yollit Permata Sari1, *, Isra Yeni1, Urmatul Uska Akbar1, Ali Anis1
1Universitas Negeri Padang, Padang, Indonesia
*Corresponding author. Email: yolitpermata@gmail.com
Corresponding Author
Yollit Permata Sari
Available Online 26 June 2023.
DOI
10.2991/978-94-6463-158-6_12How to use a DOI?
Keywords
Exchange rate pass through; impulse response; inflation
Abstract

This study uses the impulse response model from VAR to see the degree of exchange rate pass through (ERPT) to inflation. The Pass Through of exchange rate is defined as the percentage change in inflation either from the import or export side caused by changes in the exchange rate. Consumer Price Index (CPI) and the wholesale trade price index (WPI) are used in this study as the dependent variable and the exchange rate as an independent variable during pandemic conditions using monthly data from Bank Indonesia and the World Bank from March 2020 to May 2022. Using the ERPT formula in the impulse response test to see the degree of pass through of the exchange rate against the CPI and WPI, it was obtained a value of 0.24 and 0,91 respectively which means that a depreciation of the rupiah against the dollar by 1 percent will cause the CPI increase by 0.24 percent and WPI to increase by 0.91 percent. From these results, we can conclude that the ERPT for both the CPI and WPI is incomplete, which means that increase in the price level or inflation is less or not proportional to the change in the exchange rate.

Copyright
© 2023 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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Volume Title
Proceedings of the Ninth Padang International Conference On Economics Education, Economics, Business and Management, Accounting and Entrepreneurship (PICEEBA 2022)
Series
Advances in Economics, Business and Management Research
Publication Date
26 June 2023
ISBN
978-94-6463-158-6
ISSN
2352-5428
DOI
10.2991/978-94-6463-158-6_12How to use a DOI?
Copyright
© 2023 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Cite this article

risenwbib
TY  - CONF
AU  - Yollit Permata Sari
AU  - Isra Yeni
AU  - Urmatul Uska Akbar
AU  - Ali Anis
PY  - 2023
DA  - 2023/06/26
TI  - Exchange Rate Pass Through During the Covid-19 Pandemic in Indonesia
BT  - Proceedings of the Ninth Padang International Conference On Economics Education, Economics, Business and Management, Accounting and Entrepreneurship (PICEEBA 2022)
PB  - Atlantis Press
SP  - 141
EP  - 147
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-158-6_12
DO  - 10.2991/978-94-6463-158-6_12
ID  - Sari2023
ER  -