Inflation is an economic phenomenon that refers to an increase in the prices of goods and services in an economy over a certain period of time. The impact of inflation on global economic growth is very complex and varied. One of the main impacts of inflation is a reduction in people’s purchasing power. As prices of goods and services increase, consumers will find it difficult to meet their daily needs, leading to reduced consumption. This in turn can hamper economic growth because consumption is one of the main pillars in a country’s GDP (Gross Domestic Product). High inflation can also affect investments. Investors tend to become more careful in dealing with price uncertainty. When inflation rises, production costs will rise, and companies may delay or reduce investments to minimize risks. Additionally, interest rates also tend to increase in response to inflation. This increase in interest rates could make the situation worse, because it affects borrowing costs and hinders investment growth. Furthermore, inflation can affect international trade. Countries with high inflation rates may experience reduced competitiveness in global markets. An increase in the price of domestic goods can make exports more expensive, while imports become more affordable. This results in a trade balance deficit, which has the potential to weaken the country’s currency. Inflation can also create economic uncertainty among consumers and producers. This uncertainty often reduces consumer confidence in spending, as well as delays investment decisions by companies. Apart from that, the impact of inflation on employment is also significant. If companies are forced to reduce costs due to inflation, employment could be threatened, causing unemployment rates to rise. While moderate inflation can be considered an indicator of healthy economic growth, extreme inflation—such as hyperinflation—can result in a severe economic crisis. In the case of hyperinflation, the value of a currency can plummet, leading to the collapse of the financial system and economy. Countries that experience hyperinflation, such as Zimbabwe and Venezuela, show how inflation can damage the foundations of a country’s economy. Furthermore, inflation unevenly affects various segments of society. Low-income groups are usually more at risk because a larger proportion of their income is spent on basic needs. Therefore, high inflation can widen social and economic gaps. Governments and central banks often have to take steps to control inflation in order to promote economic stability. Monetary policy, such as increasing interest rates, is one way to curb inflation. However, these actions can have a negative impact on economic growth, creating a dilemma for policymakers. Overall, inflation has a significant impact on global economic growth, causing chain effects that affect various sectors and aspects of economic life. Understanding and managing inflation is a major challenge for economies around the world, especially in an increasingly integrated global context.