Shehnaz Majeed
Inflation is a general increase in prices and a decrease in the purchasing power of money. Inflation is often referred to as a “measure of the increase in the price of goods and services over time”. It not only affects the cost of living things such as transport, electricity and food but it can also impact interest rates on savings accounts, the performance of companies and share prices. As measures of inflation rised in Pakistan which is having bad impacts on the lives of poor citizens. It has reflected a reduction in the purchasing power of money. In other words, this impacts the ‘buying power’, as someone is now able enough to buy less with the money. It can impact the finances in a number of ways from the cost of the weekly shop, to the value of the long-term savings.Furthermore when it comes to the cost of living, a rising inflation measure means it has become more expensive to maintain the previous lifestyle. In this case almost many poor citizens get stuck and they don’t have any other options to get free for the purpose to bring a new hope for their family members. Even though they become unable to arrange for two times food. Then it the last it cause suicidal deaths. Which is very common nowadays. More if someone’s income hasn’t increased over the measured period by at least the rate of inflation, then the buying power will make him fall as the costs of goods and services have increased over that time. Then it will create a twenty two situation for the poor people to live a peaceful life.After a long research they found the best solution for this as the primary policy for reducing inflation is monetary policy – in particular, raising interest rates reduces demand and helps to bring inflation under control. Higher interest rates will increase the value of the exchange rate leading to lower exports and more imports. Which will boost up the economy to support the poor citizens.
