By Anthony Gilbert – Writer at http://www.realfx.com/blog/
Hyperinflation is a rapid increase in inflation where the prices rise so drastically that calling it inflation becomes meaningless. While there is no set percentage for hyperinflation, it is often used to describe price increases of 50% or more over a short period. The sharp increase is what separates hyperinflation from other types of inflation.
What Causes Hyperinflation?
Hyperinflation can occur when the government begins printing larger amounts of money to pay for spending. As the amount of money being printed increases, the prices of goods and services will increase. Typically the government would lower the supply of money to curb inflation, but when they continue to print more, there can be an imbalance in supply and demand of currency. Prices will then skyrocket, and currency will begin to lose its value. This results in hyperinflation. Hyperinflation can occur at any time but historically has often happened as results of war economies.