Cost Push Inflation

Market Terms

We don't know everything about the markets.  We're just devoted to learners.  Taken from those smarter than ourselves, here's how we define Cost Push Inflation.

A type of inflation that occurs when the demand for a commodity remains constant yet the cost of production is rising.  This pushes the burden for the price increase on the consumer, as producers raise prices to maintain profits in the face of unchanged demand.  If the commodity producer doesn’t raise prices, the profits of the company will decrease.  Common causes of Cost Push Inflation are increased raw material costs, increased labor cost/labor strike, governmental factors, and unexpected natural disasters disrupting supply chains.