What are the features of Inflation?

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Features of Inflation

Following are the main features of inflation:

(i) Inflation is always accompanied by a rise in the price level. It is a process of uninterrupted increase in prices.

(ii) Inflation is a monetary phenomenon and it is generally caused by excessive money supply.

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(iii) Inflation is essentially an economic phenomenon as it originates in the economic system and is the result of action and interaction of economic forces.

(iv) Inflation is a dynamic process as observed over the long period.

(v) A cyclical movement of prices is not inflation.

(vi) Pure inflation starts after full employment.

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(vii) Inflation may be demand-pull or cost-push.

(viii) Excess demand in relation to the supply of everything is the essence of inflation.

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