Inflation Clause
/ɪnˈfleɪʃən klɔːz/
Definitions
- (n.) A contract provision that adjusts payments or obligations according to changes in a price index to protect against inflation.
The loan agreement included an inflation clause that increased repayments based on the Consumer Price Index.
Forms
- inflation clause
- inflation clauses
Related terms
See also
Commentary
An inflation clause is commonly used in long-term contracts to maintain economic balance by linking monetary amounts to inflation indicators, thus protecting parties from purchasing power erosion.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.