What is inflation?
Inflation is the rate at which the overallof goods and services within an economy increases over a certain period of time. It is a measure for the devaluation of the of a country. The opposite of inflation is also called .
What is the impact of inflation on an economy?
As the price of goods and service increases within an economy, the national currency can purchase less and so the purchasing power ofis reduced.
Inflation is generally caused by an imbalance between the growth of the Money is a generally accepted medium of exchange to buy and... More supply and the expansion of an economy. If the money supply expands faster than the economy, then generally this results in high levels of inflation.
Inflation can also be caused by an imbalance between the supply and demand for goods; if there is a high demand for scarce products, their What are value stocks? A value company is a company that app... More rises and this can cause inflation.
How is inflation measured?
There are a number of ways to measure inflation within an economy. These generally come in the form of price indices. The What is price? The price is the measure of the value of good... More change for a basket of goods and services.is a common way of measuring inflation and gives the rate of
What is interest? In finance and trading, interest is a fe... More rates, which in turn affects the value of currencies.monitor inflation because it is a significant factor for central banks when adjusting
Learn more about the impact of inflation on currencies and forex trading: