Inflation Simulator — Money Supply, MV=PQ & Hyperinflation

Scenario

Money Supply Growth (M)

Annual ΔM (%/yr)

4 %

Velocity of Money (V)

Velocity V (turns/yr)

1.8

ΔV drift (%/yr)

0 %

Real Output (Q)

GDP growth (%/yr)

2.5 %

Central Bank Policy

Interest rate (%)

4.0 %

Statistics

4.0

Inflation (%/yr)

100

Price Level

100

Money Supply

Yr 0

Year

Fisher / Quantity Theory: M·V = P·Q
→ Inflation ≈ ΔM% + ΔV% − ΔQ%

High money growth without matching output growth drives prices up. Above ~50%/month = hyperinflation. Central bank rate hikes suppress velocity.