Inflationary Influence on Stock Price Investing – Inflation is a condition where the price of goods and services has risen in price over time and the increase occurs evenly. Inflation is an economic problem, and economic problems also affect some other economic activities such as investment and stock prices.
Do you know if inflation is affecting an investment and also affect the stock price? If you do not know yet, the Inflation Influence on investment and also the Inflation Influence on Stock Prices, you should read this one article because here I will explain in more detail and more clearly about Inflation Influence on Stock Price Investment in a description below. For those of you who want to know the problem, then consider carefully so that you can understand what are the effects of inflation on investment and stock prices.
Influence of inflation on investment
We all know that in every country, especially Indonesia, inflation is very influential on other economic activities such as investment. The effect of inflation on investment and the influence of inflation on stock prices will be explained in the following description. All you need to know is that with high inflation or
Excessive circumstances will make a negative impact or impact on stock investors on each company.
From the inflation rate is very high it will make the level of each consumption of the community to be reduced, this is due to the price of the price in the market will experience a very high increase but the salaries of employees do not experience an increase or increase but the salary of permanent employees or do not change. This will have a negative impact on the production process of each company.
Negative impacts caused by the influence of inflation on investments that will make employees to go on strike to demand a larger salary, if this happens it will adversely affect investors because investors will think many times if will invest the money. If so, then the business capital of the company will also decrease which ends in a bankruptcy.
Influence of inflation on stock prices
If the above has been told about the influence of inflation on investment, then now I discuss about the influence of inflation on stock prices. As in the above explanation that the inflation rate is very high it is very influential to other economic activities such as investment and stock prices. The higher the rate of inflation it means that the level of stock prices in a company decreased, therefore high inflation will make the level of consumption to be reduced because the price of goods increased but wages or salaries of employees did not increase