According to the Reserve Bank of Australia (RBA), inflation is defined as an increase in the level of prices of the goods and services that households buy. Remember your parents telling you that milk used to cost 10c (or less!) a litre when they were kids? That’s an easy example of inflation at work.
One of the most common measures of inflation and its effect on the average consumer is the Consumer Price Index, or CPI.
What is CPI?
Other price indexes produced by the ABS are suited to different parts of the economy; for example, the Selected Living Cost Indexes (SLCIs) are designed to measure changes in living costs for selected population sub-groups, while the Wage Price Index (WPI) measures changes in the price of labour in the Australian market.
You can learn more about CPI and how it’s calculated each quarter via the ABS.
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