Inflate

Inflate refers to the increase in the overall price level of goods and services in an economy over time, resulting in the decrease of purchasing power of money. When inflation occurs, each unit of currency buys fewer items than before. It can happen due to increased demand for products, higher production costs, or expansion of the money supply. Moderate inflation is common in a growing economy, but excessive inflation can erode savings and create economic uncertainty. Central banks monitor inflation closely and may adjust interest rates or monetary policies to keep it within a stable, manageable range.