How to Calculate Consumer Price Index
Nov 21, 2023As you already know, inflation significantly influences a country’s interest rates and, by extension, its economy. The CPI is among the most important macroeconomic indicator tools in an investor’s arsenal. Using the Consumer Price Index Formula to track how the costs of goods and services are continuously changing helps get a better read on how the economy is performing. In turn, this provides valuable insight into the state of the financial markets. The CPI YoY reflects short-term price changes, but since CPI includes all categories, it can be influenced by short-term factors, leading to significant fluctuations. To get a clearer picture of long-term price trends, analysts often look at the “Core CPI YoY”, which excludes volatile items like food and energy, providing a more stable view of price changes. Calculating the Inflation Rate Using the CPI Back in June 2022,…
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