Consumer price index (English: consumer price index, abbreviated as CPI；; Also known as consumer price index), in economics, it is a price change index that reflects the prices of products and services related to residents' lives, expressed by percentage changes.
It is one of the main indicators to measure inflation. Generally speaking, more than 3% is inflation and more than 5% is serious inflation.
CPI is often an important reference index for market economic activities and government monetary policy. CPI stability, full employment and GDP growth are often the most important social and economic goals. If the consumer price index rises too much, it shows that inflation has become an unstable factor in the economy, and the country will have the risk of tightening monetary and fiscal policies, which will lead to uncertain economic prospects.
Therefore, the excessive rise of the index is often unpopular with the market. The available means include raising interest rates, tightening monetary policy, adopting a prudent fiscal policy, increasing production and stabilizing prices.
How to calculate CPI?
The composition of the consumer price index in Chinese mainland includes food, tobacco, wine and supplies, clothing, household equipment, medical care, transportation and communication, entertainment, education and culture, and housing. Among the eight categories of products, food has the highest weight, accounting for 32.7%, so the rise in food prices will push up the whole CPI.
There is a mysterious organization that lives in 500 cities and counties across the country. They like to go to the supermarket and never buy anything. These are the price investigators under the Bureau of Statistics!
Well, do you think these investigators compile CPI after reading the price report of the Bureau of Statistics every month? It's naive. If it's so simple, do you have to say it?
First of all, the statistical scope of CPI does not include all consumer goods, but selects 262 sub-categories of goods in 8 categories.
Then the Bureau of Statistics assigns a weight to each category according to the proportion of residents' consumption expenditure. Simply put, the more people spend on certain things, the greater the weight of such things in CPI calculation. At present, the weight of China CPI is probably:
It really is a country that eats food, with food accounting for 34%! In particular, the residence in the picture does not include buying a house, but only renting and decorating, otherwise the proportion of residence would have gone against the sky. Statistics said that buying a house is an investment, not a consumption!
In this way, after the investigator knows the price, he can calculate the CPI of each city and county according to the weight. Finally, according to the consumption level of each region, give each region a weight, where the consumption level is high, the impact on CPI will be great, and then summarize and calculate the CPI of each province and the whole country.