Question

When does inflation turn into something acceptable? Most inflation is NOT good, but is there a clear line that would define acceptable inflation?

Answer 1

In the U.S. and most other countries we are willing to accept an inflatiion rate as high as 3% as acceptable and in some minds a good thing. After all, inflation on a small scale will NOT disrupt the economy or erode people's savings rapidly as happened in 1923 in Germany and Austria after WWI. So most economists would say anywhere from 1-3% is an acceptable rate of inflation for a country and may even suggest that it is generally good for the economy. wmw

Answer 2

Not really. The answer would change from country to country, and would also change in each country over different time periods. I am from India, and in our country, inflation has been at, or slightly higher than double digit for a while now, and we've been doing reasonably well. But the United States hasn't had double digit inflation for about thirty years now.

Long answer short? There isn't a clear line, and there can't be one.