CAUSES OF INFLATION. #Inflation Demand-Pull Inflation :- | UPSC Economy
CAUSES OF INFLATION.
#Inflation
Demand-Pull Inflation :-
This type of inflation is caused due to an increase in aggregate demand in the economy.
Cost-Push Inflation
This type of inflation is caused due to various reasons such as:
• Increase in price of inputs
• Hoarding and Speculation of commodities
• Defective Supply chain
• Increase in indirect taxes
• Depreciation of Currency
• Crude oil price fluctuation
• Defective food supply chain
• Low growth of Agricultural sector
• Food Inflation
• Interest rates increased by RBI
Built - in Inflation
This type of inflation involves a high demand for wages by the workers which the firms address by increasing the cost of goods and services for the customers.
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