CPI is the abbreviation of Consumer Price Index (consumerpriceindex). It is a macroeconomic indicator that reflects changes in the price levels of consumer goods and services generally purchased by households. It is also an important indicator for macroeconomic analysis and decision-making and national economic accounting.
The consumer price index is a relative number that measures the changes in the price level of a group of representative consumer goods and services over time within a specific period of time. It is used to reflect the purchase of consumer goods and services by households. changes in the price level.
Generally speaking, the level of CPI directly affects the introduction and intensity of the country's macroeconomic control measures, such as whether the central bank adjusts interest rates and whether to adjust the deposit reserve ratio, etc. At the same time, the level of CPI also indirectly affects changes in capital markets (such as stock markets, futures markets, capital markets, and financial markets).
The consumer price statistics survey is the final price of social products and services. On the one hand, it is closely related to the lives of the people, and at the same time, it also plays an important role in the entire national economic price system. It is an important indicator for economic analysis and decision-making, overall price level monitoring and regulation, and national economic accounting. Its rate of change reflects the degree of inflation or deflation to a certain extent. Generally speaking, inflation is considered to have occurred when prices rise comprehensively, consistently, and continuously.
The purpose of compiling the consumer price index is to understand the basic situation of price changes across the country, analyze and study the impact of price changes on the social economy and residents' lives, and meet the needs of governments at all levels to formulate policies and plans and carry out macro-control needs, and provide reference and basis for national economic accounting.
The combination of the Consumer Price Index (CPI) and the Employment Situation Report (Non-Farm) has become another popular economic indicator that is carefully studied in the financial market, because inflation affects everyone. People determine how much consumers spend to purchase goods and services, influence the cost of business operations, greatly undermine personal or corporate investment, and affect the quality of life of retirees. Furthermore, the outlook for inflation helps set labor contracts and shape government fiscal policy.
The Consumer Price Index measures changes over time, including the average change in retail prices for more than 200 various goods and services. These more than 200 goods and services are divided into 8 main categories. In calculating the Consumer Price Index, each category is assigned a weight that indicates its importance. These weights are determined by surveying thousands of households and individuals about the products and services they purchase. The weights are revised every two years to bring them into line with people's changing preferences.