I’ve read that many banks want a certain level of inflation and I don’t really see why. Why is important to banks that a stable product costs more tomorrow than today?
Is it to make people spend their money more since storing it will eventually make is worth less?
In: Economics
It’s impossible to maintain a currency at a perfectly stable value, and deflation is MUCH more damaging to an economy than inflation. Therefore, a currency fluctuating in mild inflation (under 3%) is generally seen as the ideal.
Latest Answers