The effects of inflation and the rupiah exchange rate on the Indonesian Sharia Stock Index: The moderating role of the BI Rate (2020–2024)

Abstract

This study aims to analyze the impact of inflation and the rupiah exchange rate on the Indonesian Sharia Stock Index (ISSI) with the BI Rate as a moderating variable during the period from January 2020 to December 2024. This study uses secondary data in the form of monthly time series data obtained from Bank Indonesia and Investing.com. The analysis method used is Moderated Regression Analysis (MRA) with the help of SPSS software version 30. The results show that inflation and the rupiah exchange rate simultaneously have a significant effect on the Indonesian Sharia Stock Index. Partially, inflation has a significant positive effect on ISSI, while the rupiah exchange rate has no significant effect. Furthermore, the BI Rate is proven to be able to moderate the relationship between inflation and the rupiah exchange rate on the ISSI. These results indicate that monetary policy plays an important role in strengthening the relationship between macroeconomic indicators and the performance of the Islamic capital market in Indonesia.