How do supply and demand for various goods and services compare in an inflationary environment?

Demand inflation is the result of excessive increases in government, consumer and private investment spending. For example, unforeseen military spending may necessitate an additional emission of money. Another reason for inflation in demand may be the emission of money to finance the budget deficit, when the state budget is drawn up with a deliberate excess of government spending over its revenues.
With cost inflation, prices rise as a result of firms’ increased production costs. For example, growth in wages, if it outstrips productivity growth, can cause cost inflation. The rise in prices for resources, primarily for energy resources, also contributes to the rise in the cost of production and, accordingly, the general rise in prices.