Macroeconomics & Investing · Entry 16 of 71

What is CPI?

The primary gauge of retail-level price inflation

Core Definition

The Consumer Price Index (CPI) measures the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.

Key Characteristics

1. Measures retail prices paid by consumers: Reflects the cost of living directly for households (food, energy, housing, healthcare).
2. Key indicator of inflation: Central banks watch CPI closely to adjust monetary policy.