The Effect of Inflation and Interest Rates on Economic Growth in Indonesia
DOI:
https://doi.org/10.59890/m6gbkc48Keywords:
Inflation, Interest Rates, Economic GrowthAbstract
This study aims to analyze the effect of inflation and interest rates on economic growth in Indonesia in the 2016-2021 period. The analysis method uses multiple linear regression analysis with the Eviews program. The results showed that the inflation variable did not significantly impact economic growth, while the interest rate variable significantly affected economic growth. This means that inflation cannot be a reference factor in economic growth because it is not substantial to economic growth in 2016-2021 of 1.51%, which is smaller than the t-table. On the contrary, the ttable on interest rates had a significant effect of 4.7% on the economic growth in the year in Indonesia. The inflation rate and interest rate as free variables, while economic growth as variables is bound. The type of data used is secondary data with a quantitative approach. Sample determination based on data for 2016-2021 uses a saturated sampling method obtained through Bank Indonesia and the Central Statistics Agency (BPS) websites.
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