Explanation

During the time of the Prophet (may Allah's peace and blessings be upon him), prices of commodities increased, so the people asked him to fix the prices of the commodities for them. The Messenger of Allah (may Allah’s peace and blessings be upon him) said to them: “Indeed, Allah is the One who fixes prices, the Withholder, the Extender, and the Provider.” This means that Allah, the Almighty, is the One who causes the prices of things to decline and rise. He is also the One who reduces the provisions for whomever He wills, and extends the provisions for whomever He wills. In other words, anyone who attempts to fix the prices will be opposing and challenging Allah in what He wills, and will most probably deny people their rights of raising and lowering prices, which Allah has entrusted them with. Then he said: “Indeed, I wish to meet Allah while none of you will have any claim against me for an injustice regarding blood or property.” This is an indication that what prevented him from fixing the price was the fear that he would wrong them in their wealth, since fixing the prices of commodities involves a sort of disposing of them without the permission of their owners, and this is considered injustice. However, if the vendors – for example traders and the like – agreed to raise the prices of what they have out of selfishness, then the ruler would become entitled to determining a fair price for the goods in order to establish justice between the sellers and buyers. This also conforms to the general principle of bringing about benefits and eliminating evil. If no agreement happened between the traders, and the prices went up only due to the high demand and low supply without any deceit, then it would not be the ruler’s right to determine the prices. Rather, he should leave the citizens so that Allah provides for some through others. Thus, it is not permissible for the traders to raise the prices over what is customary, nor is fixing the prices permissible. This is the proper understanding and interpretation of the Hadīth.