✳flâneur — a map of the web's best reading

Consumer Price Index (CPI) Explained: What It Is and How It's Used

investopedia.com · 2,108 words · saved by 1 readers

Peter Westfall is a distinguished professor of information systems and quantitative sciences at Texas Tech University. He specializes in using statistics in investing, technical analysis, and trading. Pete Rathburn is a copy editor and fact-checker with expertise in economics and personal finance and over twenty years of experience in the classroom. The Consumer Price Index (CPI) measures the monthly change in prices paid by U.S. consumers. The Bureau of Labor Statistics (BLS) calculates the CPI as a weighted average of prices for a basket of goods and services representative of aggregate U.S. consumer spending. 1 The CPI is one of the most popular measures of inflation and deflation. The CPI report uses a different survey methodology, price samples, and index weights than the producer price index (PPI), which measures changes in the prices received by U.S. producers of goods and services. 2 3 The BLS collects about 80,000 prices monthly from some 23,000 retail and service establishmen

Table of Contents Expand Table of Contents What Is the CPI? Understanding the CPI Types Formula Categories Using the CPI Explain It Like I'm Five FAQs The Bottom Line Definition The Consumer Price Index (CPI) presents the percentage change in prices that consumers pay for goods and services. Key Takeaways The CPI measures the average change in prices paid by consumers over time and is a key measure of inflation. The CPI is based on tens of thousands of price quotes collected monthly from businesses and housing units. Policymakers, financial markets, businesses, and consumers use CPI to track i

Explore this link on the map →

saved by

related reading