• HobbitFoot @thelemmy.club
    link
    fedilink
    English
    arrow-up
    9
    arrow-down
    1
    ·
    1 year ago

    i have no idea why a small amount of inflation is considered ideal

    Because it encourages money to participate in the economy. If an economy gets stuck in a deflationary cycle, it encourages people to stop putting their money into the economy to invest or to act as a way to get people to make purchases sooner.

    That can be ideal if you are anticonsumption, but not so much if you are relying on a low unemployment rate to help keep people happy.