As reported by Marketwatch, inflation in Malaysia hit 7.7% annualized. The most recent US inflation rate is about 5% annualized, although many say the Consumer Price Index in the US understates inflation.
If inflation rises to the point where ordinary folks can't afford food, starvation and political instability will result. Countries' central banks can increase prevailing interest rates to fight inflation, but that also slows economic growth by making it more expensive to borrow money to invest in businesses.
As an extreme example, Zimbabwe's is experiencing runaway inflation at tens of thousand of percentage points, mainly thanks to Robert Mugabe's incompetence.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment