Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

The consumer price index (CPI) is a measure of inflation, which in turn is the rate at which prices for goods and services are rising. 

CPI definition

The consumer price index (CPI) is a measure of inflation, which in turn is the rate at which prices for goods and services are rising. 

Other measures of inflation include the retail price index (RPI), producer price inflation and house price inflation. In the UK, the Office for National Statistics (ONS) measures CPI by looking at a weighted basket of around 700 consumer goods and services and comparing price changes month-on-month and year-on-year. You can find out more about CPI and how it is calculated on the ONS website.

Inflation is seen as a key of the health of the wider economy – a little inflation is seen as good, and stable inflation is considered to show stability in the wider economy. When inflation turns negative it is known as deflation.

The CPI is a key measure of inflation. For example, it is used by the Bank of England (BoE) policy makers when they are considering measures like interest rate increases or decreases to control inflation. The central bank currently has a policy of trying to keep CPI around the government’s target of 2%. It is more widely used by government, institutions and businesses and can impact things like the state pension, wages and state benefits.

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