The Impact of Macroeconomic Indicators on Indonesia’s Foreign Exchange Reserve Position

Surya Rahmawati(1), Suriani Suriani(2*)

(1) Universitas Syiah Kuala
(2) Universitas Syiah Kuala
(*) Corresponding Author


A country’s foreign exchange reserves are its foreign currency savings that can be utilized to finance international transactions. The purpose of this study is to determine how macroeconomic indicators (exports, imports, exchange rates, inflation rates, and foreign debt) influence Indonesia’s foreign currency reserves. The researchers used secondary data in the form of monthly time series, as well as quantitative analysis using multiple linear regression. The model that was used was the Vector Error Correction Model (VECM). According to the research, future exports and external debt have a positive impact on Indonesia’s foreign exchange reserves. Indonesia’s foreign exchange reserves are negatively impacted by imports and predicted inflation rates, whereas the rupiah exchange rate has no effect. In the model, there is a short-run to long-run equilibrium relationship. The IRF results show that shocks from other independent variables have little effect on foreign exchange reserves and that the foreign exchange reserves variable contributes the most to the shocks that occur


Exchange Reserves, Exports, Imports, Exchange Rates, Inflation.

Full Text:



Andriyani, K., Marawa, T., Adnan, N., & Muizzuddin. (2020). The Determinants of Foreign Exchange Reserves: Evidence from Indonesia. Journal of Asian Finance, Economics, and Business, Vol. 7, No. 11, 629-636.

Antoni., Akmal., & Muslim, I. (2019). Long-Term Relationships of Macroeconomic Variables on Indonesian Foreign Exchange Reserves. Menara Ekonomi, Vol. V no. 2.

Ardhani, I. A., Effendi, J., & Irfany, M. I. (2020). The effect of macroeconomics variables to Net Asset Value (NAV) growth of sharia mutual funds in Indonesia. Jurnal Ekonomi & Keuangan Islam, Vol. 6, No. 2, 134-148.

Arize, A. C. (2012). Foreign Exchange Reserves in Asia and Its Impact on Import Demand. Canadian Center of Science and Education, Vol. 4, No. 3, 21-32.

Azar, S. A., & Aboukhodor, W. (2017). Foreign Exchange Reserves and the Macro-economy in the GCC. Sciedu Press, Vol. 6, No. 3, 72-87.

Azeem, M., & Khurshid, M. (2019). Impact of Macroeconomic Variables on Foreign Exchange Reserves: A Case from Pakistan. Economic Journal of Emerging Markets, 11 (2), 173-182.

Batubara, D. M. H., & Saskara, I. A. N. (2015) Analisis Hubungn Ekspor, Impor, PDB, dan Utang Luar Negeri Indonesia Periode 1970-2013 (Analysis of the Relationship of Exports, Imports, GDP, and Indonesia's Foreign Debt for the Period 1970-2013). Jurnal Ekonomi Kuntitatif Terapan, Vol. 8, No. 1, 46-55.

Benny, J. (2013). Ekspor dan Impor Pengaruhnya Terhadap Posisi Cadangan Devisa Di Indonesia (The Effect of Exports and Imports on the Position of Foreign Exchange Reserves in Indonesia). Jurnal EMBA, Vol. 1 No. 4, 1406-1415.

Chowdhury, M. N. M., Uddin, M. J., & Islam, M. S. (2014). An econometric analysis of the determinants of foreign exchange reserves in Bangladesh. Journal of World Economic Research, Vol. 3(6), 72-82.

Usman, M., Fatin, D. F., Barusman, M. Y. S., Elfaki, F. A. M., & Widiarti. (2017). Application of Vector Error Correction Model (VECM) and Impulse Response Function for Analysis Data Index of Farmers'Terms of Trade. Indian Journal of Science and Technology, Vol 10(19).

Fukuda, S., & Kon, Y. (2010). Macroeconomic Impacts of Foreign Exchange Reserve Accumulation: Theory and International Evidence. ADBI Working Paper 197. Tokyo: Asian Development Bank Institute.

Ibrahim, W. (2011). External reserve holdings in Nigeria: Implications for investment, inflation and exchange rate. Journal of Public Administration and Policy Research, Vol. 3(4) pp, 106-112.

Indriany A.L M., Dijirimu, M. A., Anam, H., Sading, Y., & Rafika, I. (2021). The Determinant Analysis of the Indonesia’s Foreign Exchange Reserves in 2008 – 2018. ICoSIEBE 2020, DOI:

Juniantara, I. P. K., & Budhi, M. K. S. (2012). Pengaruh Ekspor, Impor dan Kurs terhadap Cadangan Devisa Nasional Periode 1999-2010 (The Effect of Exports, Imports and Exchange Rates on the National Foreign Exchange Reserves for the 1999-2010 Period). E-Jurnal Ekonomi Pembangunan Universitas Udayana, Vol. 1, No. 1, 32-38.

Kruskovic, B.D., & Maricic, T. (2014). Empirical Analysis of the Impact of Foreign Exchange Reserves on Economic Growth in Emerging Economies. Applied Economics and Finance, Vol. 2, No. 1, 102-109.

Maulina, R., Jamal, A., & Suriani. (2020). Export Analysis: Authority of Inflation and Exchange Rate in ASEAN-8. Trikonomika, Vol. 19, No. 2, 81-86.

Mendoza, R.U. (2004). International Reserve-Holding in The Developing World: Self Insurance in a Crisis-Prone Era?. Emerging Markets Review, 5, 61-82.

Nteegah, A., & Okpoi, G. E. (2016). External Trade and its implications on Foreign Exchange Reserves in Nigeria. International Journal of Arts Humanities and Social Sciences, Vol. 1(5), 21-32.

Rahim, M., Armawaddin, M., & Ahmad, A. (2019). The Role Mediation of Export and Foreign Debt in Influences Exchanges Rate on Foreign Exchange Reserves: Evidence from Indonesian. Jurnal Ekonomi & Studi Pembangunan, 11(1), 56–75.

Sutarjo, S., Murti, W., & Saleh, S. (2021). The effect of export-import, inflation, interest rates, and exchange rates against Indonesia’s economic growth. International Journal of Business, Economics & Management, 4(2), 449-460.

Tambunan, T. (2001). Transformasi EKonomi di Indonesia. Teori dan Penemuan Empiris (Economic Transformation in Indonesia. Empirical Theories and Discoveries). Jakarta: Selemba Empat.

Wikanti, A. S. (2011). Contagion Effects of Us Financial Crisis on Indonesia. Economic Journal of Emerging Markets, Vol. 3, No. 2, 125-137.

Article Metrics

Abstract view(s): 518 time(s)
PDF: 992 time(s)


  • There are currently no refbacks.