What is Cost-push inflation?

Cost-push inflation is when prices go up because it costs more to make things.

Imagine you're making lemonade every day. You use lemons, sugar, and water. One day, the store raises the price of lemons, that’s like a cost increase. Now, your lemonade costs more to make, so you decide to charge more for each cup. That's cost-push inflation in action!

Think of a factory making toys. If the price of plastic goes up, the factory has to pay more money for their materials. They might pass that extra cost on to you, the toy gets more expensive.

This can happen with anything: food, clothes, even your favorite video game! If it costs more to make something, the price usually goes up too.

Imagine your parents run a bakery. One day, the price of flour doubles because there was a big storm that damaged the wheat fields. Now, making bread is much more expensive, and so is the bread you buy at the store! That's cost-push inflation happening right in front of you.

So next time prices go up, remember, it might be because something got more expensive to make!