Inflation
The rise in level of prices of goods and services in an economy over time (the decline in the real value of money over time). The supply of money and inflation are linked. Inflation has a large effect on interest rates, which in turn effect exchange rates. Over the long term inflation means that the value of a currency will drop.
Inflation numbers influenced by GDP numbers, PPI (produce price index), CPI (consumer price index)
→ NOTE:
http://en.wikipedia.org/wiki/Inflation
http://www.forexfloor.com/inflation-indicators.html
Study Guide >> Forex Market Concepts >> Inflation