Definition
The Consumer Price Index (CPI) is a measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food, and medical care. It's calculated by taking price changes for each item and averaging them based on their share of total consumer spending. CPI is the most widely used measure of inflation and cost of living. 'Core CPI' excludes volatile food and energy prices for a clearer trend view. CPI data significantly impacts Federal Reserve policy and market expectations.
Formula
Example
If CPI rises from 300 to 309 year-over-year, inflation is 3%. A higher-than-expected CPI release often causes bond prices to fall and may trigger expectations of rate hikes, impacting stock valuations.
FAQ
What is Consumer Price Index (CPI)?
A measure tracking changes in the prices paid by consumers for a basket of goods and services.
How do you calculate Consumer Price Index (CPI)?
A common formula for Consumer Price Index (CPI) is: CPI = (当年一篮子商品成本 / 基准年一篮子商品成本) x 100
Why is Consumer Price Index (CPI) important?
Consumer Price Index (CPI) helps investors evaluate macroeconomic and make more informed decisions.