Relationship between Money Supply and Inflation in Saudi Arabia - Speech or Presentation Example

One such topic is the relationship that exists between money supply and inflation.... Link between money supply and inflation Trying to relate money supply to inflation is not as direct as it sounds as numerous factors also play significant roles in predicting or measuring inflation (Mankiw 2008).... However, the link between money supply and inflation is easily explained as a near natural occurrence since when money is in high supply within an economy the demand for it reduces....

There is a discussion of the relationship between money supply and inflation in the paper and the effects of the increase in money supply on the inflation.... Subsequent sections focus on the relationship between the money supply and inflation and on their interrelationship.... This paper outlines the relationship between aggregate money supply and the growth of the real GDP and overall level of prices in the economy.... Moreover, it is argued that the higher money supply can result into higher prices and thus if money supply is increased, it will create inflation in the economy and will hurt the real economic growth....

Some of the major programs currently in operation are: Abdul Latif Jameel Toyota Endowed Scholarship – USA Al Nada Center for Social Care – Hail – saudi arabia ALJ Hospital – saudi arabia BRJ - saudi arabia BRJ Turkiye – Turkey Family Day Initiative for Prisoners – Middle East Grameen Jameel for poverty allevation – Middle East Jameel Gallery of Islamic Art – London Prince Salman Disability Research Center – Middle East Tanweer - Orphans Supporting Initiative – Middle East BRJ Program – Introduction ALJCI's one of the major intiative is Bab Rizq Jameel (BRJ)....

relationship between money supply and inflation: A continued and uninterrupted increase in the cost of services and products is referred to as inflation (Ellis, 2011).... When the government intends to lower the inflation in a certain region, central banks stop lending the money frequently and raise the rate of interest.... However, the relationship can not be easily predicted because of the influence and role of many other factors in addition to money supply in causing inflation....

On the contrary the decrease in the oil price has affected severely to the oil exporting countries like Russia and Venezuela since Venezuela may encounter unrest on the economy and increase in the debt obligation and the fall in the oil prices have adversely affected the oil rich countries like saudi arabia as they will face severe loss if the price of oil continued to remain low.... The present decrease in the oil price on the economy is not due to the fall in demand but increase in supply of oil on the economy....