Inflation is generally defined as: under the credit currency system, the currency depreciation and the overall and sustained rise of the price level caused by the amount of money in circulation exceeding the actual needs of the economy-in more popular language, it means that the price level in a given economy generally continues to increase for a given period of time, thus causing the continuous decline of the purchasing power of money.

there are two forms of inflation, imported inflation and exported inflation.

1. Imported inflation refers to inflation caused by excessive domestic demand due to the inflow of foreign capital and a large domestic trade surplus, which is the type in China now. This will only happen when there is a relatively fixed link between the RMB and the US dollar in China. The mechanism is that the prices of international commodity products priced in dollars have risen on a large scale, and the import prices have risen accordingly.

2. Export-oriented inflation means that China's inflation is exported to foreign countries. With the appreciation of RMB, China's goods become more expensive, and the price of China's goods in US dollars rises. Then, China's goods in the American market will also rise. At present, there are still a lot of goods in China in the American market. If the price of goods in China rises, the price of their consumer goods will rise for American consumers, which is similar to the effect of inflation in the United States. With the arrival of goods from China in the United States, it is called "inflation export".