INVESTIGATION OF EXTERNAL AND INTERNAL SHOCKIN THE STABILITY OF INDONESIA’S FINANCIAL SYSTEM

Risk Governance & Control: Financial Markets & Institutions

关键词: Financial System Stability Index;    Banking Soundness Index;    Financial Vulnerability index;    Regional Economic Climate Index;   

DOI  :  10.22495/rgcv7i3p1

学科分类：社会科学、人文和艺术（综合）

来源: Virtus Interpress

【 摘 要 】

The objective of this research is to develop a financial system stability index and analyze the internal and external factors that we expect to affect the stability of the Indonesian financial system. We measured the single model of financial system stability index (FSSI) from year 2004M03 to2014M09 in Indonesia, and compiled a single quantitative measure based on aggregate internal factors and external factors to capture and predict the shocks of the financial system stability. Stability parameters were composed of composite indicators on different bases. In addition, we developed a comprehensive index component associated with the relevant market conditions, including banking soundness index, financial vulnerability index, and regional economic climate index. Results stated that US economic growth and economic growth of ASEAN countries positively affected financial stability. In addition, current account, exchange rate, inflation, interest rate were shown to negatively affect financial stability. The results of this study imply that internal factors have a strong influence on the financial stability. Therefore, the central bank should give a fast and correct response to the changes of external and internal financial environment, especially for internal factors through monetary policy.

【 授权许可】

CC BY-NC