<![CDATA[Downstreaming, the Dow Jones Islamic Market US (IMUS), and inflation are suspected to affect the performance of the Indonesian Sharia Stock Index (ISSI). This study aims to analyze the direct and indirect influence of these three variables on ISSI for the 2019–2024 period. The method used is path analysis with monthly secondary data from reliable sources. The results show that inflation has a positive and significant effect on ISSI, while downstream and IMUS have no direct effect. However, IMUS has an indirect effect on ISSI through inflation as a significant mediating variable. These findings confirm that moderate inflation (3–4%) can support the performance of the Islamic capital market, while the downstream impact is not significant in the short term. This research makes a new contribution by integrating downstream policies, global Sharia indices, and macroeconomic variables in a single model and highlights the importance of maintaining inflation stability for investors and regulators. The implication is that the government needs to strengthen downstream policies with more concrete incentives, while investors can consider inflation as a key indicator in Islamic investment decision-making.]]>
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