What are some of the main consequences of inflation?
Many governments have set their central banks a target for a low but positive rate of inflation. They believe that persistently high inflation can have damaging economic and social consequences.
Overall, a high and volatile rate of inflation is widely considered to be damaging for an economy that trades in international markets. In your analysis focus on the impact on
Deflation (negative inflation) can also be damaging for a country. You can read more about deflation in this study note.
Some possible winners and losers from a period of high inflation
Inflation - Key Term Glossary
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