The primary cause of inflation is the growth of the money supply. That means the federal government creating money. If that happens faster than the expansion of the economy, the result is too many dollars chasing too few goods and services. Thus each dollar's purchasing power is less than before.

There are other causes of price increases, like the way the price of oil going up and down causes fluctuations in the price of gasoline. But effects like these are smaller and temporary, and they cause both upward and downward pressure on prices. The only big and permanent cause of inflation is money growth. When the USA had a gold standard, there were price fluctuations, but the average rate of inflation over a a long time period was zero.

The Federal Reserve System is an attempt to improve on the gold standard by putting the federal government in charge of the money supply through a central bank.