Why do central banks want inflation?

30 September 2015

 

We all know from a personal point of view inflation is seen as bad. Bread costs more, utility bills go up and the general cost of living gets more expensive. Examples of rampant oil price induced inflation in the 1970s and 1920s Germany where citizens carrying wheelbarrows of cash just to buy a loaf of bread are well known. More recently we have seen runaway inflation in countries like Zimbabwe...

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