Browsing Tag

Inflation

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Inflation is the rate at which the general level of prices for goods and services rises over time, reducing the purchasing power of money. It means that each unit of currency buys fewer goods and services than before. Inflation is usually measured as an annual percentage and can result from increased demand (demand-pull), higher production costs (cost-push), or expansion of the money supply. Moderate inflation is normal in a growing economy, but high or unpredictable inflation can hurt savings, investments, and overall economic stability, while deflation (the opposite) can also be harmful.