Excessively high inflation is referred to as what?

Hyperinflation is characterized by an extremely rapid or out-of-control increase in prices, often exceeding 50% per month. This phenomenon typically results from a lack of confidence in a currency, leading to people rapidly spending money as it loses value. Hyperinflation can destabilize economies, erode savings, and create significant uncertainty in economic forecasts.

In contrast, stagflation refers to an economic condition where inflation and unemployment rise simultaneously, creating a stagnant economic environment with high inflation and stagnant demand. Retail inflation is a general increase in prices measured at the retail level, which does not convey the extreme rates associated with hyperinflation. Deflation, on the other hand, is the opposite of inflation, where prices decrease over time.

This clear distinction helps understand why hyperinflation is specifically used to describe scenarios with exceptionally high inflationary rates, leading to significant economic repercussions.