Inflation.. Some one Explain this??

[swatkats]

I have no knowledge towards this Economics. Was checking the Currencies last night and Inflation rate of India was 9.7% and other major countries have inflation less than 3%. Can some one Explain what exactly is Inflation % Referred to.
Now Don't think I don't know the meaning of Inflation or even never heard of it :bleh:

example: EUR - Euro rates, news, and tools

 

[always-shri]

In simple terms, how much more you need to pay to purchase the same amount of goods (or services) next year than you are paying today.

In detail, Inflation - Wikipedia, the free encyclopedia

 

[mpaspc]

In layman's term inflation is the percentage increase in general wholesale price's of various goods .

Various items contribute to inflation in varying proportions

Inflation is based on a variety of factors . IIRC food items only account for 18 or 22% of Inflation . Rest depends on non-retail items like copper , steel etc . Even after food price's rising a high rate , government can still declare a inflation at a paltry rate , since there is hardly any change in prices of non-retail items over the year .

EDIT :


watch this http://www.youtube.com/watch?v=-pwincsv4E0&feature=related

 

[swatkats]

Thanks for the replies.

 

[kuki_295]

An interesting thing
This was told by my economics prof. if inflation is say 10% and interest you get on you bank saving is 10% then you are gaining nothing for depositing money in bank.

 

[sabby]

@kuki_295 He might also said that if you keep money with you then you are actually loosing money.

 

[kuki_295]

kuki_295 He might also said that if you keep money with you then you are actually loosing money.

yes its better than keeping money, it was just a thing i thought is interesting so i posted.

 

[sharktale1212]

^ Nominal and real interest rates

 

[psygeist]