Inflation Rates in Pakistan

Inflation is an economic term used to describe rising prices of goods and services in an economy. Put simply, this means that there is a higher cost of living. Typical examples in Pakistan would include the change in prices of staple food and other essential items throughout the years. Inflation also causes the purchasing power of money to fall, so in case of inflation the real value of money is different.

Looking back at the past few years, since 2016 to 2020 the inflation rate has been on a rise. Each year, the inflation rate has increased, resulting in a steadily rising cost of living. Staple food such as rice and wheat have seen spikes in their prices and appliances such as phones and laptops also saw surges.

Inflation can have many causes, but we will be looking at two major reasons. Demand-pull inflation and cost-push inflation. Demand-pull inflation occurs when there is an increase in the aggregate demand. An overall increase in the demand in an economy results in consumers willing to buy products at higher prices. This eventually results in inflation.

Cost-push inflation, however, deals with aggregate supply. Generally, a decrease in the aggregate supply over the years results in less goods and services. This leads to scarcity at lower prices and therefore there is a rise in prices. Overall, the general cost of living increases.

Related posts:

Visualize ClickHouse data with Altinity's ClickHouse Tableau Connector  —  licensed under Apache 2.0. Coming soon to Tableau Extension Gallery.

Jill Biden and Bernard Tyson share the stage with hundreds of health innovators as they recommit to achieving audacious health moonshots.

UXers share lessons from launching the latest version of the Google Translate website