Pet peeve: there is no such thing as grade inflation because there is no grade after (or before) A.
What we're witnessing is much worse, it's grade compression where all grades move up with a hard limit.
Inflation wouldn't matter a lot, it would simply make comparisons between periods of time more difficult (we would need to "adjust for inflation").
Compression is much worse because it destroys information, namely, the difference between good and bad works in the same class.
If we had "price compression" in real life, society wouldn't be able to function (everything would cost the same).