Belgium Inflation Rate from 1988 to 2013

Belgium Inflation Rate from 1988 to 2013
Inflation describes the consumer price index and it reflects the yearly change (percentage) in the cost to the consumer in obtaining a pack of goods and services. The costs of the goods and services for the average consumers might change or remain fixed for a period of a year or other specified period. All nations of the globe experience inflation at one point or the other following political changes, as well as change in the national and global economic circumstances. Imperatively, high inflations cause a rapid rise in the cost of living for the citizens as the prices for goods and services skyrocket. In such cases, consumers obtain lesser goods and services for more money than when the rate of inflation was low. Further, inflation rate influences the value of the local currency of a nation. The brief write up will provide a twenty five year track of Belgium`s inflation rate. The percentages of the same are provided in the table below.
Country (Belgium)
Year
Inflation Rate (%)
Belgium
1988
1.2
,,
1989
3.1
,,
1990
3.5
,,
1991
3.2
,,
1992
2.4
,,
1993
2.8
,,
1994
2.4
,,
1995
1.5
,,
1996
2.1
,,
1997
1.6
,,
1998
1.0
,,
1999
1.1
,,
2000
2.5
,,
2001
2.5
,,
2002
1.6
,,
2003
1.6
,,
2004
2.1
,,
2005
2.8
,,
2006
1.8
,,
2007
1.8
,,
2008
4.5
,,
2009
-0.1
,,
2010
2.2
,,
2011
3.5
,,
2012
2.8
,,
2013
1.0
Though not the lowest, Belgium`s inflation rate in 1988 stood at 1.8%. The inflation rate was relatively low compared to the six years that followed as the inflation rates rose as high as 3.5 % (Organization for Economic Co-operation and Development, 1988).
Notably, the rate of inflation in Belgium is grounded on the consumer price index (CPI). The consumer price index illustrates the alteration in prices of goods and services (standard package), which the households of the nation buy for the purpose of consumption (Visser, 2005). In line with the argument, an assessment of the annual changes of the consumer price index has indicated that the rate of inflation has been rising and falling year after year compared to the preceding periods. Therefore, there were cases of serious inflation in Belgium with the highest recorded percentage being 4.5 in 2008. On the contrary, the high inflation rate was followed, by significant deflation rate, which recorded at -0.1, in 2009. It is also significant to note that the inflation rate for Belgium averaged at 2.26 percentage for the last 25 years.
During the time when the inflation rate reached the 4.5%, which was the highest recorded rate of inflation, the prices for gods and services were extremely high. The cost of housing, education, healthcare, transport went within a short period. Furthermore, household goods become relatively expensive and lots of people dropped numerous luxurious goods and activities. Business corporations and organizations were struggling with maintaining the workforce throughout the entire period of intense economic pressure. As a result, many organizations resulted to downsizing their workforce thus people lost their jobs and source of livelihoods. The situation of loss of jobs coupled with increased price index for consumer goods made life extremely difficult for Belgium citizens.
The government introduced measures, which were tailored to fix the high inflation situation, and save the people from the suppressive economic environment. With the mechanisms in place, the entire high inflation situation was reversed in the year that followed (2009). During the year, the inflation rate diminished to -0.1 and the economic situation became fairly friendly to the people. However, business corporations took time to recover the economic shock thus the corporations failed to re-employ the workers (Gwartney, 2009). Therefore, the effects of the high inflation rate were experienced long after the period was over. Cases of high inflation were also experienced in 2011 and 2012 as they were in 1989 to 1994.
It is imperative to note that, the periods of low inflation rate were experienced, in Belgium for considerable number of years during the twenty five year period. The situations were similar to the most recent inflation rate, in the nation, which stands at 1.0%. During the periods of low inflation rate, business in the nation encountered periods of economic triumph thus managed to create lots of job opportunities. Such employment opportunities translated from rapid business growth, as well as expansion. On the same note, the living standards of the people improved due adequate disposable income and low cost of life. The state managed providing social amenities as healthcare, security, infrastructure, and education to the citizens, without intense strain.
Conclusively, Belgium has had periods of high inflation, as well as low inflation periods. However, there were no extremes on both sides of the consumer price index (high and low) during the twenty five years period. However, the effects of high inflation rates were significantly experienced, by citizens businesses and citizens. The consumer price index kept shifting from low to high, and there were periods of stabilization for a couple of years.
References
Gwartney, J. D. (2009). Macroeconomics: Private and public choice. Mason, OH: South-Western Cengage Learning.
Organization for Economic Co-operation and Development, (1988). Belgium Luxembourg [1987-1988]. Paris: OECD.
Visser, H. (2005). A guide to international monetary economics: Exchange rate theories, systems and policies. Cheltenham: Edward Elgar.

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