In economics and personal finance, a sustained increase in the general price level is called inflation.
Inflation reduces the purchasing power of money when prices rise and income or savings do not keep pace. A currency unit buys fewer goods and services than it did previously. Inflation is usually reported as a percentage change over a specified period.
Consumer price indexes measure price movements across selected baskets of goods and services. Individual households can experience different effective inflation rates because spending patterns vary.
Inflation is not the same as one product becoming more expensive. The term refers to a broad change in prices. Deflation describes a general decline in prices, while disinflation means inflation is slowing without necessarily becoming negative.