THE EFFECT OF USD/IDR EXCHANGE RATE, INTEREST RATE, AND WORLD OIL PRICE TO JAKARTA COMPOSITE INDEX (JCI)

This research aims to investigate effect of selected macroeconomic variables, i.e., USD/IDR exchange rate, interest rate, and world oil price to indonesia composite index at the indonesia stock exchange (IDX). This paper examine the direct effect of selected macroecomonic variable on Indonesia Composite Index. The study used time series data from the 2012-2017. By using an regression technique analysis, the result from showed that simultaneously the exchange rate, interest rate, and world oil price have a significant effect on Indonesia Composite Index. Partially, only the exchange rate has a significant effect on Indonesia Composite Index, interest rate and world oil price have no significant effect on Indonesia Composite Iindex. The amount of influece caused by the three variables is 58% and the rest is explained by other variables.


INTRODUCTION
The capital market is an important factor in economy in a particular in Indonesia. Composite Index is a stock price index figures already compiled and calculated by producing trend, where the index number is a number that are processed in such a way that can be used to compare events that can be changes in stock prices over time (Jogiyanto, 2013 Interest rate is the price of the use of money for a certain period of time or the price of the use of money which is used at the moment and will dikembali right at a future time. Interest rate is the ratio of return on a number of investments as a form of reward given to investors (Husnan, 2009).
Interest rate is the price of a loan. Interest rates are expressed as a percentage of money from the principal per unit of time.
the interest rate is a measure of the price of the resources used by the debtor to be paid to creditors (Sunariyah, 2011). According to Boediono (1994) the interest rate is one indicator in determining whether someone will make an investment or saving. prevailing in the oil markets (Mensi et al, 2017).  (2008) examines the theoretical and empirical relationships between the major exchange rates and price of gold and finds that floating exchange rate system has been a major source of price instability in the world gold market.
These views are supported by Beckers and Soenen (1984), Sjaastad and Scacciavillani (1996), Capie et al. (2005)  rates have no effect upon gold prices. Yahyazadehfar and Babaie (2012) demonstrates that house price, interest rate, The study concluded that exchange rate does not granger cause gold price. Sinton (2014) finds that there is no long-run association among gold price, stock price and exchange rate in Indonesia. Bhunia and Pakira (2014) found no causal relationship among stock market and gold price as well as among exchange rate and stock-market whereas bidirectional association was found among gold price and exchange rate in India. (2015)    Based on the Table 2   Based on the Table 5, this study has a normal distribution, seen from a probability value (0,434 or 43%) that exceed 0,05 or 5%.

Srinivasan and Prakasam
This regression model can be used because it fulfilling the assumption of normality test.
Based on the Table 7, it is found that value of probability from each independent variables above there is no significant or more than 5%, which means there are no independent variables that affect the ARESID variable (Absolute Residual) so     This study still has some limitation: (1) This study only used exchange rate, interest rate and world price oil as variables that explain about macroeconomy and need more variable of that to make this research more accurate.
(2) The data in this study were limited to the monthly data throughout 2012-2017 obtained in Indonesia and need more specific data as sample, as an example using data day by day or week by week to get results better than this study. PT Asdo Mahasatya. Jakarta.