Homonym: CPI (Index)
The Consumer Price Index, or CPI, is a measure that examines the average change over time in the prices paid by consumers for a basket of goods and services. This basket includes items like food, clothing, and housing, which are essential for everyday living. By tracking these prices, the CPI helps to assess inflation and the cost of living, providing valuable information for policymakers, businesses, and individuals.
CPI is calculated by collecting price data from various sources and comparing it to a base year. Changes in the CPI can indicate whether prices are rising or falling, influencing economic decisions and adjustments in wages, pensions, and social security benefits.