[stag-fley-shuh
n] 
| an inflationary period accompanied by rising unemployment and lack of growth in consumer demand and business activity. |
| stag·fla·tion (stāg-flā'shən) n. Sluggish economic growth coupled with a high rate of inflation and unemployment. [stag(nation) + (in)flation.] stag·fla'tion·ar'y (-shə-něr'ē) adj. |
An economic phenomenon of the late 1960s and 1970s characterized by sluggish economic growth and high inflation. The word is a blend of stagnation and inflation.
Stagflation
A condition of slow economic growth and relatively high unemployment - a time of stagnation - accompanied by a rise in prices, or inflation.
Investopedia Commentary
Stagflation occurs when the economy isn't growing but prices are - not a good situation for a country to be in. This happened to a great extent during the 1970s, when world oil prices rose dramatically, fueling sharp inflation in developed countries. For these countries, including the U.S., the effects of inflation were considerably made worse because of this stagnation.
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See also: Deflation, Disinflation, Inflation, Stagnation
stagflation