Inflation
Definition
A sustained increase in the general price level of goods and services in an economy over time.
Explanation
Inflation erodes purchasing power: $100 today buys less than $100 a year from now. The Federal Reserve targets 2% annual inflation as the sweet spot — enough to encourage spending (holding cash loses value) without causing economic distortion. The Consumer Price Index (CPI) is the most common inflation measure. Core CPI excludes volatile food and energy prices. The 2021-2023 inflation surge (peaking at 9.1% CPI in June 2022) was the highest in 40 years, triggered by pandemic stimulus, supply chain disruptions, and energy price spikes.
How Stoquity Uses This
Stoquity incorporates inflation analysis across its portfolio management platform, providing real-time monitoring and AI-powered insights for every portfolio.