What Is The Definition Of Inflation Premium

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What is the inflation premium? - Quora
Inflation is a persistent and progressive increase in the prices of goods and services. An inflation premium is the part of prevailing interest rates that results from lenders compensating for expected inflation by pushing nominal interest rates to higher levels.
Inflation - Wikipedia
In economics, inflation is a sustained increase in the price level of goods and services in an economy over a period of time. When the price level rises, each unit of currency buys fewer goods and services; consequently, inflation reflects a reduction in the purchasing power per unit of money – a loss of real value in the medium of exchange and unit of account within the economy.
Inflation Premium | Definition | Formula | Example
Inflation premium is the component of a required return that represents compensation for inflation risk. It is the chunk of interest rate which investors demand in addition to real risk-free rate due to risk of decrease in purchasing power of money.

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