<![CDATA[Since September 2023, Bank Indonesia has activated a triple intervention strategy along with SRBI/SVBI/SUVBI instruments to stabilize the Rupiah amid depreciation pressure exceeding Rp17,000, yet domestic inflation has remained contained — an anomaly at odds with classical exchange rate pass-through (ERPT) theory. This study formally tests whether this ERPT dampening reflects a structural policy-regime shift. Using monthly data for the period January 2017–June 2026, covering the regime before and after BI's active intervention since September 2023 and a Vector Autoregression (VAR) framework, the study applies multi-scale linearity testing, bootstrap placebo tests, Generalized Impulse Response Functions (GIRF), a Threshold VAR (TVAR) as sensitivity analysis, a Nonlinear ARDL-based Error Correction Model for asymmetry testing, and Forecast Error Variance Decomposition (FEVD). Linearity and placebo tests across nine system-threshold combinations consistently fail to reject a linear specification. In the main model, no statistically significant exchange-rate transmission to inflation is found at any horizon (0–12 months); exchange-rate shocks explain only 0.16% of inflation forecast-error variance (FEVD). These findings support the hypothesis that active exchange-rate intervention has dampened the pass-through channel to domestic inflation.]]>
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