The Consumer Price Index (CPI) is the most widely used measure of inflation. It provides monthly data on changes in the prices paid by urban consumers for a representative basket of goods and services.

Source: Bureau of Labor Statistics

Frequently Asked Questions

• How is the CPI used?
  The CPI affects nearly all Americans because of the many ways it is used. Following are major uses:
  • As an economic indicator
  • As a deflator of other economic series
    
  • As a means of adjusting dollar values
• Is the CPI a cost-of-living index?
  The CPI frequently is called a cost-of-living index, but it differs in important ways from a complete cost-of-living measure. BLS has for some time used a cost-of-living framework in making practical decisions about questions that arise in constructing the CPI. A cost-of-living index is a conceptual measurement goal, however, not a straightforward alternative to the CPI. A cost-of-living index would measure changes over time in the amount that consumers need to spend to reach a certain utility level or standard of living. Both the CPI and a cost-of-living index would reflect changes in the prices of goods and services (such as food and clothing) that are directly purchased in the marketplace; but a complete cost-of-living index would go beyond this to also take into account changes in other governmental or environmental factors that affect consumers’ well-being. It is very difficult to determine the proper treatment of public goods, such as safety and education, and other broad concerns, such as health, water quality, and crime that would constitute a complete cost-of-living framework.