INFLATION

 WHAT IS INFLATION?

Inflation is defined as a rise in the prices of goods in a country that reduces the purchasing power of its citizens. Inflation is not altogether absent from any economy. It keeps on fluctuating. It remains normal as long as it does not surpass its threshold for a year. 

Any unexpected increase in the prices of necessities of life can enrage a layman and change his political views. The society also expects public demonstrations and protests if inflation continues to rise above determined levels. Inflation is beneficial only for inflators.

INFLATION IN PAKISTAN:

The depreciation of the Pakistani Rupee is a significant factor in the rising inflation in Pakistan. The political instability in the country over the past few months also impacted the currency devaluation. Oil prices have a crucial role in increasing inflation. Transportation of food to great distances requires more fuel consumption. HIGH OIL PRICES raise shipping costs. It also has a great impact on the cost of production of crops as fuel is required in the agricultural sector. 

RECOMMENDATION:

It is the responsibility of the government to keep inflation within reasonable levels. The lack of coordination between federal and provincial governments creates room for an increasing rate of inflation. Effective social protection plays an important role in controlling inflation.