Abstract:
The purpose of this study is to analyze the influence of US dollar exchange rate,
money supply and imports toward BI rates and their implication to the inflation in
Riau Province. Path analysis and trimming methods were applied to study the
direct and indirect effects by using AMOS 25. The study shows that US dollar and
import have a significant and positive effect on BI rate, while the amount of
money has a significant effect and negative to the BI rate. Furthermore, US dollar
has a significant and negative effect on inflation, the BI rate has a significant and
positive effect on inflation while import does not have significantly influence on
inflation. Indirectly, the US dollar affects the inflation through the BI rate, while
import does not have a significant effect on inflation through the BI rate.