CAUSES OF INFLATION

• The demand-pull inflation: Inflation occurs when aggregate demand increases more rapidly than reduction. This increase may have different origins: an increase in household consumption, increased public spending or spending on business investment.

• The cost-inflation: Inflation would by increasing production cost. Maybe motivated by the rising cost of asic natural resources, or the cost borrowing or interest rate.

• The structural-inflation: Is an existence of imperfect markets, which set prices at levels higher than those of free competition, conflict between economic agents, the existence of administered prices to project or benefit certain social sector.