The prices for goods and services around the world are constantly rising, which is an economic phenomenon called inflation.
Most governments welcome a certain level of inflation, but too great an increase or a decrease in prices can be dangerous for an economy.
“Economists have come around to the view that a little bit of inflation is good,” CNBC anchor Joumanna Bercetche said.
“It’s like Goldilocks, you don’t want it to be too hot and too cold. You want it somewhere in the middle,” Bercetche added.
“Usually inflation is a sign of a well-functioning, productive and growing economy.”
Watch the video above to learn more about what causes inflation, how it’s measured and why governments are obsessed with keeping it under control.