World

Economy:
Inflation Rate
Presented by Group 8
Presenter : Thein Myint Oo
What is Inflation?
In economics, inflation is a general increase in the prices of goods and services in an economy. When
the general price level rises, each unit of currency buys fewer goods and services; consequently,
inflation corresponds to a reduction in the purchasing power of money.

In short,
Inflation is an increase in the over all price level.

Hyperinflation is increasing in the over all price level rapidly in a period of

time.

Deflation in decreasing in overall price level.

 Inflation and value of money
• Inflation leads to a decline in the value of
money. “Inflation means that your money
won’t buy as much today as you could
yesterday.”
• If the prices of goods rise. the same
amount of money will purchase a smaller
quantity of goods.
History of Hyperinflation 01 Bolivia Peso 1984
(The Graveyard of Currencies)
02 Yugoslav Dinar 1994

03 Belarus Ruble 2000

04 Romanian Lei 2005

05 Zimbabwe Dollar 2008

Worst Cases of
Hyperinflation
Two Major Factors of Inflation
• Cost-push inflation - when a rise in prices is caused by a rise in the cost of production, such as
higher oil prices
• Demand-pull inflation - when a rise in prices is caused by rising aggregate demand and firms
pushing up prices due to the shortage of goods

• Other than this, Wars, Pandemic like Covid 19, money supply and other impacts can cause
hyperinflation.
 Measuring Inflation
To calculate inflation, the statistics authority (ONS)

Measure the price of 1,000 goods every month

Gives a weighting to different goods depending on how important they
are in a typical basket of goods.
An index is created with calculates the weighting of good * price change.
 Costs of Inflation
• A decline in value of savings
• Uncertainty for business
leading to less investment.
• A decline in the
competitiveness of exports (if
inflation higher than in other
countries.)
Causes of Inflation
 Inflation Rate in Myanmar

• Averaged 12.90 percent from 1998 until 2022, reaching an all

time high of 54.02 percent in December of 2002.
Current Myanmar Inflation Rate
Gold Standard Removal of US Dollar