Voting in European Union Election. Photo Credit: Envato @vetre
Inflation plays a significant role in shaping government fiscal and monetary policies. Governments of dominant economies often aim to maintain a moderate level of inflation to encourage spending and investment. However, high inflation can lead to stringent monetary policies, including increased interest rates and reduced government spending. For instance, during the hyperinflation period in Zimbabwe, the government was forced to adopt severe monetary policies to control inflation.
