inflation risk

Definition

The possibility that the value of assets or income will decrease as inflation shrinks the purchasing power of a currency. Inflation causes money to decrease in value at some rate, and does so whether the money is invested or not.

Use inflation risk in a sentence

There was an inflation risk, but that would not change our course of action and everything would go as planned still.

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The value of a dollar is closely followed and measures are taken to avoid inflation risk which could cause the value of the US dollar to decrease to substantially.

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The inflation risk of the dollar used to be leveraged by gold when the United States backed it's currency valuation with precious metals such as gold and silver, a method known as the Gold Standard.

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