Have you ever wondered calculating the CPI inflation rate? If no, then you learn how to do it. Do you want to learn calculating Customer Price Index? If yes, then you can do it on your own without taking help of anyone else. It is a measurement in the U.S. for the price level of the economy at a certain time period. It is a great way to notice changes in the price levels in the U.S. Most of the times, CPI is used to calculate the inflation rate. Here are the steps which you can follow to calculate the CPI inflation rate easily:
• If you think that it is really difficult to calculate the CPI inflation rate, then you are wrong because it would be really easy if you will try it. First of all, you need to collect the CPI numbers starting from the beginning and last years of a particular time period. The time for which you want to calculate the interest rate should be considered in it.
• This formula for the calculation of CPI inflation rate is given by the Bureau of Labor Statistics website and you can definitely use it because it is the correct way to calculate it. You need to subtract the CPI from the recent year of CPI from its first year.
• Imagine that the CPI in the first year was 17.0 and it is 17.8 in the present year, then the result will be 17.8-17.0= 0.8.
• After this calculation, you can divide it by CPI of the first year and this would give you the answer. Make sure that you remember to move decimals to the right in order to convert it into a percentage.
• After you convert it into a percentage, you can find out if it is inflation or deflation. If you will get the positive number in the answer, then it is inflation otherwise it would be deflation in the case of a negative number.
So, these are the easy ways to learn how to calculate the cpi inflation rate in the easiest way. You won’t find any difficulty in calculating it because it is really simple to do this calculation. Sometimes, your calculation might be weak and in that case, you can use the calculator available at the online platform. If the CPI gets over 100%, then it might be difficult for you to calculate the inflation because it can become confusing. The formula would remain the same but you might have difficulty in making its calculation. When you find out that there is 100% inflation, then the price if doubled and if there is 200% inflation, then you can believe that the prices are tripled in the given time.
When the prices go down, then you will get the negative value and it would be called deflation. If you don’t want to go deep into the mechanics, then you can calculate the inflation by using CPI-Inflation calculating tool online. It will be really easy for you to calculate it through the online tool.