How does inflation affect gdp?

High inflation can have a negative effect on GDP by decreasing investment and consumer spending, decreasing purchasing power, and increasing uncertainty. As prices rise, consumers may delay purchases in the hope that prices will fall, or they may have less money to spend due to the decrease in their purchasing power. Businesses may also delay investment or expansion plans due to the uncertainty caused by high inflation. Additionally, high inflation can also lead to increased cost of production, which can further decrease GDP.