The Effectiveness of the Macroprudential and Monetary Policies in Indonesia: Financial Stability and Price Stability Approach
Date
2018-01-16Author
Dana, Badara Shofi
Wardhono, Adhitya
Nasir, Muhammad Abdul
Qori'ah, Ciplis Gema
Metadata
Show full item recordAbstract
Policy mixes by Bank Indonesia to promote sustainable economic growth not only through monetary policy in
stabilizing prices but is also necessary for the stabilization of the financial system through the implementation of
macroprudential policies in the financial system. This study can contribute to the development of the conceptual
framework of monetary and macroprudential policy mixes as well as to provide an effective alternative transmission
in achieving the main objective of Bank Indonesia. The data used in this study are monthly data in 2007M1 to 2016M9.
The variables used were the nominal exchange rate, inflation, credit, real GDP, asset prices and Index Financial
Stability (ISSK). Instruments used as macroprudential monetary policy mixes areBI rate and GWM primary, GWM
secondary, GWM Valas, GWM+LDR, LTV, and CCB. Structural Vector Autoregression (SVAR)is applied to see
the influence of variables through the restriction as well as instruments that have an effective influence. The results
showed that the interest rate of Bank Indonesia which is accompanied by GWM primary, GWM secondary, GWM
Valas, GWM+LDR, LTV, and CCB influence price stabilization through credit and economic growth, while in the
stabilization of the financial system, interest rate instruments, secondary statutory reserves and statutory reserves
Currency influence through credit, asset prices and exchange rates.
Collections
- LSP-Conference Proceeding [1874]