INFLATION
What Is Inflation? How It's Measured and Managed Definition: Inflation is the rising price of goods and services over time. It's an economics term that means you have to spend more to fill your gas tank, buy a gallon of milk or get a haircut. Inflation increases your cost of living . Inflation reduces the purchasing power of each unit of currency. U.S. inflation has reduced the value of the dollar . Compare the dollar's value today with that in the past. As prices rise, your money buys less. That's how inflation reduces your standard of living over time. That's why President Reagan said, "Inflation is as violent as a mugger, as frightening as an armed robber, and as deadly as a hit man." Here's more on how inflation impacts you life . The inflation rate is the percent increase or decrease of prices during a specified period. It's usually over a month or a year. The percentage tells you how quickly prices rose durin