Inflation Rate

The inflation rate is a measure of how quickly prices for goods and services are rising in an economy. The inflation rate is often expressed as a percentage and can be calculated monthly, quarterly, or annually. It indicates the percentage change in the general price level compared to the previous period.

The most commonly calculated inflation rate is based on the consumer price index (CPI), which measures the rate of inflation for goods and services purchased by private households. Similarly, producer price inflation can be calculated from the producer price index (PPI). This reflects changes in the prices of intermediate goods and finished goods.

Inflation can be caused by a number of factors, including demand for goods and services, the availability of raw materials, unemployment, and the monetary policy of the central bank.