Question

how an increase in wages could cause inflation

Answer 1

Economists track wages closely because of their wage push inflationeffects. ... Additionally, any wage increase that occurs will increase the money supply of consumers. With a higher money supply, consumers have more spending power, so the demand for goods increases

Answer 2

Economists track wages closely because of their wage push inflation effects. ... Additionally, any wage increase that occurs will increase the money supply of consumers. With a higher money supply, consumers have more spending power, so the demand for goods increases.