Analisis Faktor-Faktor yang Mempengaruhi Financial Deepening di Indonesia

Developments in the financial sector largely determine a country's economic growth. This study aims to determine the effect of real interest rates, exchange rates (exchange rates), and inflation on financial deepening in Indonesia. The type of data used in this study is time series data. Data used from 1988-2018 using the Error Correction Model (ECM). Based on the results of the F test the model is classified as exist. T test results, in the short term the Real Interest Rate and Exchange Rate (Exchange) have a significant positive effect, while inflation does not have a significant effect on financial deepening in Indonesia. In the long term, the Real Interest Rate, Exchange Rate (exchange rate) and inflation have a significant negative effect on financial deepening in Indonesia. Determination coefficient test results (R2) show that the R-squared value of 0.691600 or equal to 69.16%. This means that variations in the Indonesian Financial Deepening variable can be explained by variations in the independent variables in this study which consist of variables of real interest rates, exchange rates (exchange rates) and inflation. While the remaining 30.84% is explained by variations of other independent variables outside the estimated mode