Changes

In economics, '''inflation''' is a general rise in the price of goods and services in relation to purchasing power.

In economics, '''inflation''' is a general rise in the price of goods and services in relation to purchasing power.

Prices tend to go up when demand from consumers exceeds the normal capacity of producers to supply goods and services. An excess supply of goods and services tends to put downward pressure on prices. See [[supply and demand]].

Prices tend to go up when demand from consumers exceeds the normal capacity of producers to supply goods and services. An [[supply and demand|excess supply of goods and services]] tends to put downward pressure on prices.

High inflation undermines the economy's ability to generate long-lasting growth and job creation. Consumers and investors may put off purchases because of uncertainty. High inflation erodes the value of incomes and savings. People on fixed incomes, including the elderly and poor are particularly vulnerable to inflation.   

High inflation undermines the economy's ability to generate long-lasting growth and job creation. Consumers and investors may put off purchases because of uncertainty. High inflation erodes the value of incomes and savings. People on fixed incomes, including the elderly and poor are particularly vulnerable to inflation.