Unanticipated inflation benefits both borrowers and savers equally, as both groups experience a decrease in the real value of their financial commitments.

Unanticipated inflation happens when prices rise unexpectedly, making money lose its value faster than people expect. For borrowers, this means they pay back loans with money that is worth less than when they borrowed it, so their debt feels lighter. For savers, however, inflation erodes the purchasing power of their savings, making it harder to buy the same things with their saved money. While borrowers might benefit from lower real debt, savers actually lose because the money they saved buys less than before. For example, if someone saved $100 and inflation rises by 10%, that $100 can now only buy what $90 could have bought before inflation.