Inflation Rate – Calculator | Formula | Explanation

LAST UPDATE: May 21st, 2018

Inflation rate calculator (via CPI)

What is the inflation rate?

The inflation rate is the rate that the consumer price index (CPI) is increasing. It is listed as a percentage.

As the price level of goods and services change over time, the CPI tracks the changes in prices.

A high inflation rate (considered to be more than 2%) means that prices are going up quickly, a low inflation rate (considered to be between 0 and 2%) means that prices are going up slowly. A negative inflation rate means that prices are going down.


\text{Inflation Rate} = \frac{\text{Current Year's CPI} - \text{Last Year's CPI}}{Last Year's CPI} \times 100


If the current year’s CPI is 152 and last year’s CPI is 148, then:

\text{Inflation Rate} = \frac{152 - 148}{148} \times 100

\text{Inflation Rate} = \frac{4}{148} \times 100

\text{Inflation Rate} = 0.0270 \times 100

\text{Inflation Rate} = 2.70

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