IKHSAN
Senior Lecturer, Faculty of Economics and Business, UniversitasSyiah Kuala, Banda Aceh, Indonesia
ikhsan30303@unsyiah.ac.id
Cut Dian FITRI
Lecturer, Faculty of Islamic Economics and Business, Universitas Islam Negeri Ar-raniry, Banda Aceh, Indonesia
cutdianfitri@ar-raniry.ac.id
Hafiizh MAULANA
Lecturer, Faculty of Islamic Economics and Business, Universitas Islam Negeri Ar-raniry, Banda Aceh, Indonesia
hafiizh.maulana@ar-raniry.ac.id
Khairul AMRI
Lecturer, Faculty of Islamic Economics and Business, Universitas Islam Negeri Ar-raniry, Banda Aceh, Indonesia
khairul.amri@ar-raniry.ac.id
(corresponding author)
Abstract
The main purpose of the paper is to determine the effect of inflation on total deposits and the financing of sharia commercial banks in Indonesia. A monthly time series data over the period of 2012.1-2017.6 was analyzed using Johansen Co-integration test, vector error correction model, and Granger causality test. The co-integration test indicates that there is a long-run relationship between the variables. In the long-run, inflation is negatively related to total deposits and sharia financing. In the short-run, the inflation has no significant effect on the two variables. The sharia financing has a negative effect on itself at the 1 and 2-month period. The result of the Granger causality test points out that there is a bidirectional causality relationship between total deposits and sharia financing. Furthermore, unidirectional causality running from the inflation to sharia financing and from total deposits to the inflation.
Keywords: Inflation, Total Deposits, Sharia Financing, VECM, and Granger Causality Test
JEL classification: E31, E51, G21, N15