Inflation Calculator


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Current cost
Rate of inflation(%)
Time Period(years)
CostIncreased CostFuture Cost
1,00,000 -1,00,000 0

Inflation is a persistent increase in the general price level of goods and services in an economy over a period of time. This rise in prices leads to a fall in the purchasing power of money – a unit of currency buys fewer goods and services than it did before.
Inflation can be caused by various factors, including an increase in production costs, a rise in consumer demand, and a decrease in the supply of money or credit. It can be measured using an inflation index, such as the Consumer Price Index (CPI), which tracks the changes in the prices of a basket of goods and services consumed by households. Central banks, such as the Federal Reserve in the US, attempt to maintain price stability by setting and adjusting monetary policy. They may increase or decrease the money supply, set interest rates, and engage in open market operations to influence inflation. Inflation can have both positive and negative impacts on an economy. Moderate inflation can stimulate economic growth by encouraging spending and investment, while high inflation can lead to higher production costs, reduced consumer purchasing power, and economic instability. Deflation, a sustained decrease in the general price level, can also have negative effects on an economy by reducing consumer spending and investment.

An inflation calculator is a tool used to determine the relative purchasing power of a certain amount of money in the past compared to the present day. It takes into account the rate of inflation and calculates the equivalent amount of money in today's dollars, allowing individuals to see the effect of inflation on their purchasing power over time. The tool can be useful for financial planning, budgeting, and historical research.

Inflation Calculator - FAQ

What is inflation?

Inflation is a general increase in the prices of goods and services in an economy over time. This means that the purchasing power of money decreases as prices rise.