Forecasting the Inflation Rate in Indonesia Using Backpropagation Artificial Neural Network

Economic growth is an essential indicator in measuring a country’s economic development. The stability of the Rupiah exchange rate against the prices of goods and services is included in inflation. Another problem is an increase in the poverty rate. This happens because inflation tends to rise while people’s real income continues to decline, so people’s living standards also follow. This inflation can be caused by two things: domestic pressure and external pressure. The pressure experienced from within the country is a change in market prices. Therefore, it is necessary to forecast the inflation rate in Indonesia by applying an Artificial Neural Network. Based on the results, predicting the inflation rate in Indonesia takes work. The RMSE value generated in predicting the inflation rate using an Artificial Neural Network is 0,41273932. The MAPE value generated in predicting the inflation rate using an Artificial Neural Network is 15.7%. Using all the variables determining the inflation rate got different results than the actual value.