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Is near zero level inflation is bad?

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Anonymous

16y ago
Updated: 8/17/2019

Though a Zero inflation is practically very difficult to achieve, very low levels of inflation are actually bad for the economy.

Inflation determines the increase in prices of goods and services in a country's economy year on year. A very low or zero inflation means a very low level of growth in prices for goods and services which in turn implies that the economic growth in the country is also very poor.

In a growing or flourishing economy the prices of goods and services increase in a steady and consistent manner year on year. This means the country's economy is growing steadily.

Inflation rates of around 5-6% are considered ideal for countries. A very low inflation is bad for the economy and at the same time a double digit inflation is also very bad for the economy.

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Wiki User

16y ago

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