Inflation Rates 1914-2014

Project #461 on iSENSEProject.org

OVERVIEW

This data gives a measurement of the annual change based on the price index for personal consumption expenditures (PCE). The Federal Open Market Committee believes that an inflation rate of 2% is optimal for maintaining price stability and strong employment rates.  High inflation rates (hyperinflation) caused by an excessive growth in money supply hinders long term economic and financial decision making and devalues currency that is already in circulation.  Low inflation rates often leads to deflation which causes higher rates of unemployment and reduction in wages.  This correlates to a decrease in demand for goods and dampens economic growth.  Maintaining a low level of inflation mitigates the penalties incurred from weak economic conditions.  Measures such as Quantitative Easing have been emplaced to ensure that inflation does not fall below target levels.

SOURCE

http://www.usinflationcalculator.com/inflation/historical-inflation-rates/

http://www.federalreserve.gov/faqs/economy_14400.htm