The Influence of Inflation Perception, Money Function Understanding, and Trust in Monetary Policy on Islamic Monetary Preference with Religious Commitment as a Moderating Variable

Global economic volatility and persistent inflation have weakened public confidence in conventional monetary systems, creating space for Islamic finance as a potential alternative. This study examines the determinants of Islamic monetary preference by analyzing the roles of inflation perception, understanding of money functions, and trust in monetary policy, with religious commitment as a moderating factor. Data were analyzed using Partial Least Squares–Structural Equation Modeling (PLS-SEM), and the reliability and validity of the constructs were confirmed. The results indicate that inflation perception positively influences Islamic monetary preference, suggesting that inflation awareness encourages consideration of alternative systems. Understanding of money functions exerts a stronger effect, highlighting the role of financial literacy in aligning individuals with value-based principles. Trust in monetary policy is the most decisive determinant, underscoring the importance of credible and transparent governance in shaping monetary attitudes. Religious commitment demonstrates a distinct moderating role, amplifying the effect of inflation perception and moderating the influence of money function understanding, though its interaction with trust in monetary policy remains inconsistent. This study advances theoretical understanding by linking economic perceptions with religio-cultural values in explaining Islamic monetary preferences.