Analysis of the Effect of Exchange Rates, Inflation, Interest Rates, and Gross Domestic Product on the Balance of Trade in Indonesia

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Analysis reveals long-term effects of inflation and interest rates on Indonesia's trade balance, suggesting crucial economic insights.

In the long term, inflation and interest rates significantly affect Indonesia's trade balance, while exchange rates do not.
The study showed that in the short term, neither exchange rates nor GDP significantly impact the trade balance.
Using the Error Correction Model, the analysis covers data from January 2014 to December 2023 for thorough insights.
Findings emphasize the importance of considering long-term economic conditions in trade policies for Indonesia.

Subiyanto et al. (2025) studied this question.

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