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Inflation, detailed information about inflation

For a summary of all current inflation figures please click here.

This page contains detailed background information about inflation.

Inflation in brief

Inflation means a reduction in the value of money; in other words, a rise in general price levels. The literal meaning of the word inflation is to blow up or get bigger. If the amount of money in a country - the money supply - grows faster than production in that country, the average price will rise as a result of the increased demand for goods and services. Inflation can also be caused by higher costs being charged on to the end-user. These might be raw material costs or production costs which have risen, but could also be higher tax rates. These price rises cause the value of money to fall. You can therefore buy less with the same amount of money. But this does not need to have an immediate effect on purchasing power. Purchasing power only declines if wages rises less rapidly than prices.

Consequences of limited inflation

Governments often strive for an inflation rate of around 2 to 3 percent per year. Such low inflation is beneficial for the economy. Low inflation encourages consumers to buy goods and services. Delaying will mean that they would have to pay more for the same product. Low inflation also makes it more appealing to borrow money, since interest rates are usually also low during periods of low inflation. Maintaining low inflation is therefore an important goal for governments and central banks because of the economic benefits.

Consequences of high inflation

As indicated above, limited inflation is good for the economy. But high inflation is less beneficial. High inflation can cause the population’s confidence in their own currency and economy to decline, and it can be less appealing for foreign investors to invest in the country concerned. High inflation therefore often has a harmful effect on economic growth. If inflation gets too high, a country’s central bank will often intervene by raising its interest rates and thus discourage the creation of money.

Consequences of deflation

The opposite of inflation is deflation. With deflation the real price level falls. You can therefore buy more and more with the same amount of money as time passes. Deflation is very bad for economic growth because it is very likely that consumers will postpone their purchases because they expect to have to pay less for them in the near future. In periods of deflation governments and central banks often seek to stimulate the economy, for example by lowering interest rates.

The most important inflation figures

A wide range of inflation figures are recorded and published in most countries and regions. These include consumer prices and producer prices. These figures make it possible to monitor price developments closely. This website features the following inflation figures for a large number of countries:
  • CPI consumer prices
    CPI stands for ‘consumer price index’. It is a measure of the average price that consumers spend on goods and services in a market-based ‘basket’ of goods and services. In order to calculate the CPI, the prices of a collection of goods and services need to be collected. These prices are then weighted on the basis of the share that they have of average consumer spending. The index is usually calculated annually, but in some countries it is also done quarterly. For most countries the inflation based on the CPI is viewed as the most important inflation figure for the country. The CPI can be used to adjust things like wages/salaries and pensions.

    For a summary of the CPI (consumer price index) by country please click here.

  • HICP consumer prices
    The ECB created the HICP, the Harmonised Index of Consumer Prices, in order to be able to compare consumer prices between the various EU countries. This is a consumer price index which is comparable to the CPI and which has been harmonised for the EU. The HICP is a weighted average of the price indices of the member states and is calculated for each country. The EU sets itself the goal of safeguarding price stability, which means an HICP of around 2% a year in the medium term.

    For a summary of the HICP (harmonised consumer price index) by country please click here.

Popular CPI inflation figures
Summary CPI by country
Inflation Belgium CPI
Inflation Brazil CPI
Inflation China CPI
Inflation Germany CPI
Inflation France CPI
Inflation Great-Britain CPI
Inflation Italy CPI
Inflation Japan CPI
Inflation the Netherlands CPI
Inflation Russia CPI
Inflation Spain CPI
Inflation United States CPI
Popular HICP inflation figures
Summary HICP by country
Inflation Belgium HICP
Inflation Europe HICP
Inflation France HICP
Inflation Germany HICP
Inflation Great-Britain HICP
Inflation Greece HICP
Inflation Italy HICP
Inflation the Netherlands HICP
Inflation Portugal HICP
Inflation Spain HICP
Inflation Sweden HICP
Inflation Turkey HICP
Historic inflation figures
Inflation 2016
Inflation 2015
Inflation 2014
Inflation 2013
Inflation 2012
Inflation 2011
Inflation 2010
Inflation 2009
Inflation 2008
Inflation 2007
Inflation 2006
Inflation 2005
Inflation 2004
Inflation 2003
Inflation 2002
Inflation 2001
Inflation 2000
Inflation 1999

In order to be able to show the data on this page, we make use of a large number of sources of information that we believe to be reliable. For more information and our disclaimer, click here.

American inflation CPI1.46 %september 2016
English inflation CPI0.90 %september 2016
European inflation HICP0.41 %september 2016
German inflation CPI0.65 %september 2016
Japanese inflation CPI-0.50 %august 2016
Chinese inflation CPI2.28 %september 2016
All inflation figures, click here
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