Causes And Effects Of Inflation In Egypt

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What are the causes and effects of inflation and how to solve this issue in Egypt? According to the center bank the dollar price have reach to 8.85 and it is still going up) exchange rate), and that besides the floating of the Egyptian pound. It means that the Egyptian pound has no value. The dollar has increased and imports have jumped, Egyptian products become expensive, as the imports depend on the dollar, and once the dollar has grown up the prices of all products increase to a high level compare to the same income and no value of the available currency, but with increase in the amount of the currency. Thus increasing the prices and constancy the income dramatically, cause inflation which means increasing in the prices, decreasing in the purchasing power of money with increasing in the available currency, but not enough goods and services (The American Heritage, Published by Houghton Mifflin), thus inflation means increasing prices but with enough money but less goods and services; as a result, inflation can affect the objectives of the macroeconomic. One mainly of the objective is balance of trade and provide markets with enough supplies with suitable prices. Moreover inflation has many causes, a lot of consequences on the economy and society, but also inflation has some solution to figure it out in order to prevent its effects. Inflation has many reason to take place in Egypt. According to the National business “printing more money only adds to Egypt inflation”.

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