CPI Indicator
Introduction
The consumer price index or consumer price index[1] (commonly called by its acronym CPI) is an economic index in which the prices of a certain set of goods and services are valued (known as "family basket" or "basic food basket) determining, on the basis of the continuous family budget survey (also called "household expenditure survey"), that a number of consumers acquire on a regular basis, and the variation with regarding the price of each one, compared to a previous sample. It measures changes in the price level of a basket of consumer goods and services purchased by households.
This is a percentage that can be positive (indicating an increase in prices) or negative (reflecting a fall in prices).
It is an indicator widely used by governments to measure inflation.
Characteristics
It is assumed that every CPI should be:.
• - Representative and reliable, taking the sample randomly and covering the largest possible population in a certain area.
• - Comparable, both temporally and spatially, with other CPIs from other countries or periods in the same country.
Uses of the CPI
The objective is to measure the evolution of the prices of goods and services representative of the consumption expenditures of households in a region. The uses that are usually given are:
• - Inflation indicator (knowing that the CPI does not include the prices of intermediate consumption by companies or exported goods).
• - Deflator of national accounts (or national accounting) and other statistics.
• - Cost of living estimator (knowing that the CPI cannot be a cost of living index because it has large differences with it).
• - It is also used to invoke salary review clauses.
Generally we see that the loans requested in various financial institutions are reflected in UF or UTM, since the CPI will also readjust to such indicators, so the effect of inflation on said debts will be more easily reflected.