Create Date: January 20, 2025
Last Modified Date: January 20, 2025
Inflation rate is a rather simple calculation, granted you have the two CPI values that are needed. You will need to have the CPI of two different periods, which for the USA can be found on the Bureau of Labor website.
Once you have the CPI values of the periods you can then use this formula to find the inflation rate:
When you use this tool you will get a percentage shown as your result. That percentage represents the rate of inflation which denotes how much prices have changed over your designated period's values. If your result is a positive value then the price of things have gone up meaning inflation is taking place, while if the result you get is a negative value then the price of items are going down and deflation is taking place.
Be sure to enter the correct values for CPI to correctly get the rate of inflation. There are many sources for this number and many that also will show you the incorrect values.
If you want to use a tool to find the rate of inflation you are in the right place. Our tool is a very simple and easy-to-use calculator. The steps involved include:
We want to understand the rate of inflation that was experienced between November and December of 2024. We must first find the CPI in November which was reported to be 315.493. Now we will find December's CPI which is reported to be 315.605. We can now enter both values into the appropriate fields and hit calculate. When we do, we get an inflation rate of .035% indicating very minor inflation.
Inflation itself is not bad, it is a natural occurring thing that will never go away. Inflation must happen at some points but there are times when inflation can get out of control where it can lead to negative consequences and can be an indicator for the economy.
There are many factors that can impact the rate of inflation, singling out the single most impactful one can be rather tough. In general, the main cause of inflation will be increase in prices which can come from higher costs of doing business, higher wages, or other similar factors. You can learn more about this topic on the International Monetary Fund's website.
Inflation can lead to greater profits for businesses which can also lead to better returns on investments in their company. During times of moderate and controlled levels of inflation production in the country can rise, more jobs typically are opened and more bumps in salary are seen, among other possible positives.
The opposite of inflation is deflation. This is where the value of things trend downward. This can cause the value of currency to increase since the price of items are going down.
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