Airlangga International Journal of Islamic Economics and Finance
Vol. 7 No. 02 (2024): JULY-DECEMBER 2024

ANALYSIS OF MACROECONOMIC VARIABLE CHANGES TO THE RESILIENCE OF ISLAMIC BANKING IN INDONESIA

Moh Yusron Solikin (Unknown)



Article Info

Publish Date
29 Nov 2024

Abstract

This research aims to analyze the changes in macroeconomic variables such as economic growth, inflation, exchange rates, and interest rates on the resilience of Islamic banking in Indonesia. Additionally, it seeks to prove that Islamic banks are resistant to economic crisis. This quantitative study used monthly data period series of January 2006 to January 2020 with the Autoregressive Distributed Lag (ARDL) and Markov Switching (MS) methods. ARDL test results indicates that economic growth and exchange rates significantly affect Islamic banking resilience. Economic growth has positively influence, while exchange rates have a negative impact. Conversely, inflation and interest rates do not play any role in affecting Islamic Bank resilience. Through the test, Markov Switching proved that Islamic banking is resistant in the face of an economic crisis that lasts more than a period of crisis than a quiet period.

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Journal Info

Abbrev

AIJIEF

Publisher

Subject

Economics, Econometrics & Finance

Description

Airlangga International Journal of Islamic Economic and finance (AIJIEF) publishes quality and in-depth analysis of current issues within Islamic finance and Islamic economics. The journal welcomes robust evidence-based empirical studies and results-focused case studies that share research in ...