Open AccessPERBEDAAN MANAGED FLOAT EXCHANGE RATE SYSTEM DAN FREELY FLOATING EXCHANGE RATE SYSTEM DI INDONESIA
Author(s) -
Mudji Utami
Publication year - 2003
Publication title -
manajemen dan bisnis/manajemen dan bisnis
Language(s) - English
Resource type - Journals
eISSN - 2477-1783
pISSN - 1412-3789
DOI - 10.24123/jmb.v2i2.61
Subject(s) - float (project management) , exchange rate , inflation (cosmology) , international fisher effect , floating exchange rate , economics , monetary economics , relative purchasing power parity , floating interest rate , relative price , inflation rate , interest rate parity , covered interest arbitrage , interest rate , fisher hypothesis , real interest rate , physics , management , theoretical physics
Consequence of the freely floating system and freely foreign exchange system, rupiah could he easily fluctuated, because exchange rate shift not in response but as governed by the interaction between supply and demand in the money markets. The supply and demand forces are influenced by the relative interest rate and relative of inflation. Thus this study examine whether there is a difference of magnitude in the influence of the relative interest rate and relative rate of inflation to the USD - IRD exchange rate when Indonesia adopts respectively the managed float exchange rate system and the freely floating exchange rate system. The finding shows at the level of confidence 95%, that there is no significant difference in the influence of the relative interest rate and relative rate of inflation to the USD - IRD exchange rates between both systems.