Why is inflation rising globally, and how can central banks control it?

Inflation is rising globally because there’s more money chasing the same amount of goods and services, like when everyone wants the last cookie in the jar.

Imagine your piggy bank is full of coins, and you decide to give out extra coins to everyone, that's what central banks do when they want to help people spend more. But if too many people are spending at once, there aren’t enough cookies (or toys, or food) for everyone, so prices go up, that’s inflation.

Central banks act like the traffic cops of money. If they see prices rising too fast, they might decide to take some coins out of circulation, like taking a few coins from your piggy bank and putting them in a special jar. This makes people think twice before spending, which can slow down inflation.

Sometimes, central banks also raise the cost of borrowing money, just like when you have to pay more to rent a toy for longer. When loans become more expensive, people might spend less, helping to bring prices back down.

It’s all about balance, giving out coins to help the economy grow and taking some away to keep things from getting too pricey.