STERILISASI DAN PROBLEM ALIRAN MASUK MODAL DI INDONESIA

Abstract

This study is aimed to analyse the influencing of private capital inflow with exchange rate and inflation. Analysis methods which is used in this research is structural vector cointegrating VAR (SCVAR) with simultaneous model. Impulse response test result, showed that the shock of exchange rate is negatively responsed by private capital inflow, this is explained through indirectly exchange rate path that the depreciation of exchange rate increase the price of import goods, that causes cost push inflation. National product that depands on import goods, caused the increase of National output production cost. Central Bank intervention to overcome the distortion in the economic instability, is done through BI rate, which soon transmitted to banking rate. Interest rate differential becomes attractive power to foreign investor and speculator that has great return orientative. Current account deficit is negatively responsed by private capital inflow, it is showed by the high of Indonesian import as the implication of two cases, the first, high investation as result of great number of private capital inflow. The Second, national product is highly consists of import goods. The phenomenon of price puzzle can be seen from the supply side that is representated through forward looking of expectation from economic agent about inflation in the future.