How Does The Inflation Effect The Pakistan Economy In Last 10 Years?


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The repercussions of inflation are felt as a result of escalating fuel and commodity prices in Pakistan. It increases the cost of living and strikes panic given the anticipated economic uncertainty. There are several consequences of price inflation :-

1) Uncertain economic atmosphere leads to unemployment as the cost of production increases the employers tend to reduce their costs by laying off employees.

2) Investors and cartels tend to stock commodities for later selling which further exacerbates the problem.

3) Lesser returns on investment, increase in the export prices.

4) it results in an increase in rents.

5) lesser interest rates on investment returns while a greater interest rate is applied on lending.

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